Euro­pean eq­ui­ties fail to main­tain gains

Malta Independent - - FINANCIAL -

The rally in en­ergy pro­duc­ers wasn’t enough for Euro­pean eq­ui­ties to main­tain their gains af­ter U.S. data stocked con­cern about the econ­omy as the Fed­eral Re­serve con­tem­plates rais­ing in­ter­est rates.

On Thurs­day the Stoxx Europe 600 In­dex gained less than 0.1 per­cent, al­most com­pletely eras­ing its ad­vance in the last hour of trad­ing. A re­port showed U.S. pend­ing home sales slumped in Au­gust, just as Fed Bank of At­lanta Pres­i­dent Den­nis Lock­hart said the cen­tral bank is near­ing its goals of max­i­mum em­ploy­ment and steady in­fla­tion near 2 per­cent.

Ear­lier, the Stoxx 600 ral­lied as much as 1.1 per­cent as a sur­prise OPEC agree­ment stoked con­fi­dence for an earn­ings re­cov­ery at en­ergy com­pa­nies.

The gains in en­ergy pro­duc­ers came just as their val­u­a­tions reached about 15 times es­ti­mated earn­ings, the low­est since Jan­uary rel­a­tive to the Stoxx 600. While the Stoxx 600 Oil & Gas In­dex jumped as much as 31 per­cent since Jan­uary, the re­bound lost steam in re­cent weeks as the com­mod­ity stalled.

Bri­tain’s FTSE 100 In­dex ral­lied 1 per­cent, clos­ing at its high­est level since the 15th Au­gust high. The rally in com­mod­ity com­pa­nies boosted the mea­sure, which was the big­gest gainer among ma­jor western-Euro­pean mar­kets. France’s CAC 40 In­dex gained 0.3 per­cent, while Ger­many’s DAX In­dex fell as much. The MSCI All Coun­try World In­dex slid 0.6 per­cent as of 6:50 a.m. in New York, par­ing this quar­ter’s ad­vance to 4 per­cent. The Stoxx Europe 600 In­dex slid 1.1 per­cent.

Crude oil fell 1 per­cent to $47.36 a bar­rel in New York, af­ter gain­ing more than 7 per­cent over the last two days. While Wed­nes­day’s agree­ment among Or­ga­ni­za­tion of Pe­tro­leum Ex­port­ing Coun­tries im­posed an over­all pro­duc­tion cap on the group of 14 oil pro­duc­ers, it didn’t as­sign in­di­vid­ual lim­its — that was left to a com­mit­tee that will re­port back at OPEC’s next meet­ing in Novem­ber.

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