AFP/London
Global stock markets were mostly firmer in quiet holiday trade yesterday, calming down after recent turmoil and as investors found little new in a French-German summit on the eurozone debt crisis. Dealers said the meeting on Tuesday between French President Nicolas Sarkozy and German Chancellor Angela Merkel continued the slow, uncertain move towards greater eurozone policy integration but produced little else of wider note. A proposal for a Europe-wide tax on financial transactions was dismissed as old hat, likely to be ineffective at best and at worst, to drive business out of Europe into other centres. The news hit stock market operators such as Deutsche Boerse and NYSE Euronext, which plan to merge, especially hard. US stocks picked up at the opening, posting modest gains on the back of strong corporate results, especially in the retail sector, but then slipped back. In London, the FTSE 100 index of leading companies closed down 0.49% at 5,331.60 points. In Frankfurt, the main DAX index shed 0.77% to 5,948.94 points but in Paris the CAC 40 gained 0.73% to 3,254.34 points.Milan’s FTSE Mib index added 1.27% and Madrid gained 0.62%. The euro was at $1.4428 after falling initially, compared with $1.4407 in New York late on Tuesday. The dollar slipped to ¥76.50 from ¢76.80. Commerzbank analysts said the results of the Sarkozy-Merkel summit “are rather disappointing and are unlikely to support the euro much.” Traditional safe-haven gold was at around $1,787 an ounce. Analysts said a Sarkozy-Merkel proposal to centralise eurozone policy under European Union president Herman Van Rompuy at least continued the push towards tighter eurozone controls so as to ultimately control the debt problems. “It’s not eye-poppingly original because it institutionalises an existing practice,” said Christian Parisot, an economist with French investment managers Aurel. “But you can still say it is an extra step towards greater cross-border coordination of economic policy,” he said. The plan for a financial transactions tax, however, was roundly dismissed as a sop to disaffected voters which would prove harmful in the unlikely event it was ever implemented. UBS analyst Arnaud Giblat noted that a similar tax in Sweden in the 1990s resulted in an 85% fall in transactions while Britain pointed out that such a levy could only effectively be introduced on a global basis. Britain, home to the major financial markets in Europe, has always opposed any regulation that would undercut that business. Sarkozy and Merkel also disappointed markets by declining to back the idea of issuing “euro bonds” to pool the debts of the 17 eurozone members and by insisting the bloc’s existing €440bn ($634bn) bailout fund is “sufficient”. Tuesday’s “statements will do little to calm market nerves on the region, as the major issues remain the same,” said Dermot O’Leary, an analyst at Goodbody Stockbrokers in Dublin.