A man walks past Germanwings and Lufthansa logos at Duesseldorf airport. News of a Germanwings plane crash sent shares in Lufthansa sinking more than 4%, but they recovered to end the day down 1.56% at €13.57.
AFP/London
Shares in German airline Lufthansa tumbled after a plane in its low-cost division Germanwings crashed in the French Alps yesterday, with all 150 people on board feared killed.
News of the crash sent shares in Lufthansa sinking more than 4%, but they recovered to end the day down 1.56% at €13.57, still the worst performer on the Frankfurt stock market.
Shares in European plane maker Airbus initially sank more than 2% in Paris, but ended the day with a gain of 0.52% at €60.31.
Eurozone markets mostly pushed higher yesterday on encouraging economic signals.
Frankfurt’s DAX 30 index climbed 0.92% to 12,005.69 points, while the CAC 40 in Paris rose 0.67% to 5,088.28 points.
However London’s benchmark FTSE 100 index ended the day down 0.26% at 7,019.68 points as data showing the Chinese economy slowing weighed on mining stocks.
European stocks had initially fallen in the wake of disappointing Chinese manufacturing data, but perked up after a survey showed eurozone business activity hit a near four-year high in March.
The closely watched Markit Economics report Composite Purchasing Managers Output Index (PMI) rose to 54.1 points from 53.3 in February, putting it well above the 50-point mark that shows growth.
“The eurozone’s economic recovery gained further momentum in March, with the PMI hitting its highest for almost four years,” said Chris Williamson, chief economist at Markit.
“The improvement provides welcome news to a region awaiting signs that the ECB’s quantitative easing is stimulating the real economy.”
Bruno Cavalier, chief economist at Oddo Securities in Paris, said “the ultra-pessimists got it wrong this time.” He said European businesses and households responded to the calming economic conditions rather than alarmist warnings.
In foreign exchange activity yesterday, the European single currency slipped to $1.0921 from $1.0945 late on Monday in New York, as positive US data fuelled hopes of a quick interest rate hike.
US new home sales surged by 7.8% in February, and Markit’s US PMI rose by 0.2 points to 55.3 in March. US consumer prices also showed a rise in February for the first time in four months.
The market sees strong economic data as increasing the likelihood that the US Federal Reserve may begin raising interest rates as soon as June, which pushes up the dollar.
An interest rate hike and strong dollar are not as positive for US companies, and stocks were mixed on Wall Street.
The Dow Jones Industrial Average slid 0.17% to stand at 18,084.41 points in midday trading.
The broad-based S&P 500 slipped 0.01% to 2,104.14, while the tech-rich Nasdaq Composite Index added 0.28% to 5,024.92 points.
