AFP/London

European stocks fell yesterday following news that the eurozone recession deepened in the final three months of last year, but some major companies were boosted by upbeat results.
London’s FTSE 100 index of leading companies fell 0.5% to 6,327.36 points, while Frankfurt’s DAX 30 shed 1.05% to 7,631.19 points, and in Paris the CAC 40 lost 0.78% to 3,669.60 points.
Madrid’s Ibex 35 index gave up 0.71% to 8,247.4 points, hit hard by tumbling bank shares, and Milan’s FTSE MIB dropped 1.0% to 16,545 points.
The European single currency touched a three-week low at $1.3315, before recovering some ground to $1.3329, still down from $1.3452 late on Wednesday. Gold edged up to $1,646 an ounce from $1,645 on the London Bullion Market.
“Europe’s markets experienced their own version of a GDP Valentine’s Day massacre as the contraction expected in the fourth quarter of 2012 proved to be much steeper than expected,” said CMC Markets analyst Michael Hewson.
The recession in the 17-nation eurozone deepened sharply in the fourth quarter of 2012 as the debt crisis continued to sap growth and confidence, official data showed.
The eurozone economy shrank 0.6% in the three months to December, which compared with a contraction of 0.1% in the previous quarter.
In the second quarter of 2012, it contracted 0.2%, meaning that the recession has now lasted three quarters. The eurozone had, meanwhile, registered zero growth in the first quarter of last year.
Despite the gloomy data, traders drew some comfort from a string of upbeat company earnings.
In Paris, BNP Paribas shares rose 2.0% to €46.75 after the French bank said net profits rose 8.3% last year to €6.55bn, outperforming most of its rivals.
The price of shares in French automaker Renault jumped 7.6% to €46.50, even though the group posted a 15.3-percent drop in 2012 net profit to 1.77bn euros. But the results were far stronger than those of PSA Peugeot Citroen, which was downgraded one notch by Standard and Poor’s to ‘BB minus’ yesterday, a day after posting a record 5bn euro loss for 2012.
Shares in French energy giant EDF rallied 5.0% to €14.95 after it announced a 5.3% gain in annual net profit and reassured over its plans to cut as much as €1bn in costs this year.
On the downside in Madrid, shares in Spanish bank Bankia collapsed by 12.39% to 41¢ after a suspension of trading in the stock was lifted.
Trading had been suspended at the request of the market regulator CVNMV and after a publication reported that the value of the shares would be reduced to 1¢.
US stocks drifted down despite the announcement of two giant M&A deals: the merger of American Airlines and US Airways, and Berkshire Hathaway’s takeover of ketchup maker Heinz.
The Dow Jones Industrial Average was off 0.13% to 13,965.13 points in midday trading.
The broad-based S&P 500 slid 0.06% to 1,519.46 points, while the tech-rich Nasdaq Composite shed 0.10% to 3,193.68 points.



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