European shares end down, but make fourth weekly gain
European shares closed lower yesterday, with drugmakers giving up some recent gains and energy companies lower on weaker crude prices after data showed slower growth in the US economy than previously reported. The FTSEurofirst 300 index of leading...
European shares closed lower yesterday, with drugmakers giving up some recent gains and energy companies lower on weaker crude prices after data showed slower growth in the US economy than previously reported.
The FTSEurofirst 300 index of leading European shares fell 0.5 per cent to close at 1,077.52 points, having hit its highest close since early October 2008 in the previous session.
Over the week, the index rose 1.1 per cent, notching up its fourth straight weekly gain. It is up more than 66 per cent from its lifetime low of March 9, 2009.
Analysts noted yesterday's pull-back had come after a strong run, but some said the market was now looking expensive.
"It is likely that the newsflow coming up will disappoint, compared with the high level of expectations," said Tammo Greetfeld, equity strategist at UniCredit Group.
"The market has benefited from the relief that the EU has agreed a support mechanism for Greece. But the underlying causes of the tensions are not resolved yet."
Across Europe, the FTSE 100, Germany's DAX and France's CAC 40 shed 0.1 to 0.3 per cent.
Pharmaceutical stocks were among the biggest losers, not helped by German plans to cut patented drug prices.
Shire, GlaxoSmithKline, Novartis, Roche and Sanofi-Aventis fell between 1.1 and 1.9 per cent.
On the upside, Greek lenders surged 8.4 per cent, encouraged by an agreement by eurozone leaders for a package for debt-laden Greece under which Athens would receive both bilateral loans from eurozone partners and International Monetary Fund funding if it faced severe difficulties.
National Bank, EFG Eurobank, Piraeus Bank and Alpha Bank rose between 8.1 and 12.7 per cent.
The Greek stock market was closed on Thursday for a holiday.
Concerns remain, however, over how the debt burden would be managed in practice and over the fiscal health of other eurozone peripheral countries.
Energy companies suffered as crude prices fell below $80 a barrel following the US GDP data, and after data earlier in the week showed US crude inventories rising.
BP, BG and Royal Dutch Shell fell between 0.5 and 1.7 per cent.
The US economy grew at a slightly less brisk pace in the fourth quarter than previously estimated, while corporate profits slowed sharply from the prior quarter, government data showed.
US consumer sentiment ended unchanged in March from February, a survey showed, slightly beating expectations.
UniCredit's Mr Greetfeld forecasts the DAX to fall to 6,000, down two per cent from its current level.
He said: "We think equity markets will be in a sideways movement or correction phase for several months."