MARKETSCOPE: World equity prices were mixed on Thursday, as investors took profits and continued wondering if the U.S. will pause its credit tightening program.
In London, the Financial Times-Stock Exchange 100 index fell in price by 25.2 to 5440.70 on profit taking, even though October Brent crude oil fell from its earlier highs. Among major stocks, MFI Furniture fell as orders at its U.K. retail chain slumped 15% during the past 3 months. Premier Farnell fell after news that its second quarter profits dropped. BATM Advanced Communications rose as its first half losses shrank. Highway Insurance Holdings rose on stronger first half profits.
But German stocks were up slightly. In Frankfurt, the DAX Index was rebounding from its earlier slide and rose 4.61 to 4992.75. Oil prices, higher at the outset, fell on U.S. inventory reports showing drawdowns. But shares in E.ON fell in price after Merrill Lynch cut its recommendation of the company to "neutral" from "buy," saying E.ON's potential bid for Scottish Power may bring uncertainty in the months to come. Fraport rose after a German court rejected an environmental group's complaint about the company's plans to build a hangar for the Airbus SAS A380 superjumbo jet.
Paris stocks fell, with the CAC 40 down 20.25 to 4465.94 on profit taking. Among major companies, Lafarge fell after it said its first half profit slumped 18%. Essilor International fell after the company said its second half profits won't match those of the first half. Cap Gemini rose after posting its first profit in 3 years. Oberthur Card Systems rose after Credit Agricole Chevraux upgraded the stock to "outperform" from "underperform," while Sechilienne Sidec rose after Apax Partners raised its offer for the company.
Stocks in Tokyo lost value, as investors took some money off the table ahead of Japan's general election on Sunday and absorbed news that July machinery orders fell. The Nikkei 225 fell 73.70 pts (0.58%) to 12,533.89. Major stock indices recovered from their worst levels of the day in late trading, however.
Stocks in Hong Kong were hurt partly by concerns of more rate hikes in the U.S. After an initial plunge following the Katrina disaster, bond yields in the U.S. have moved higher, as early speculation of an end to the Fed's tightening cycle cools.
South Korea's KOSPI rose 0.2% to close at an all-time high, but the broader market was weak, with declining issues outpacing advancing issues by 361 to 236. South Korea's central Bank left key rates at its record low of 3.25% for a tenth consecutive month in order to boost domestic consumption.