Real-estate firms trade higher; Daily Mail & General Trust drops
By Simon Kennedy, MarketWatch
LONDON (MarketWatch) — European equity markets were mixed Thursday as a strong finish on Wall Street helped boost German and U.K. stocks, while the peripheral markets again came under pressure from worries about sovereign debt.
The Stoxx Europe 600 index (ST:STOXX600 266.74, +0.45, +0.17%) rose 0.2% to 266.81 in morning trading.
The gains came after a strong session for stocks on Wall Street, which continued to rally into the closing bell after well-received data. U.S. markets will be closed Thursday for the Thanksgiving holiday.
The U.K.’s FTSE 100 (UK:UKX 5,675, +17.49, +0.31%) advanced 0.4% to 5,677.09 as gains for the mining sector helped boost the index. Shares in Xstrata (UK:XTA 1,340, +16.00, +1.21%) were up 2.2%.
Shares in Capital Shopping Centres Group (UK:CSCG 371.60, +34.20, +10.14%) were the biggest gainer in the FTSE index, climbing 10% after the company said it had received a preliminary approach from Simon Property Group Inc. (SPG 100.27, +2.70, +2.77%) . See London Markets.
Other real estate companies were also big climbers. Hammerson (UK:HMSO 411.00, +23.60, +6.09%) rallied 5.5% and British Land (UK:BLND 495.00, +16.80, +3.51%) gained 3.8%.
Among the other major indexes, Germany’s DAX 30 (DX:DAX 6,844, +20.35, +0.30%) rose 0.2% to 6,838.31 as car makers BMW (DE:BMW 59.92, +0.92, +1.56%) and Volkswagen (DE:VOW3 125.52, +0.57, +0.46%) both rose around 1%.
Brian Gallagher an analyst at Dolmen Stockbrokers, said investors are still using dips in the market to buy stocks that have the most exposure to high-growth emerging markets, including miners, German industrial stocks and car makers.
But the picture in the rest of Europe was weaker. The French CAC 40 index (FR:PX1 3,748, +0.24, +0.01%) slipped 0.1% to 3,742.64, the Irish ISEQ index fell 0.6% to 2,669.24 and Spain’s IBEX 35 index dropped 0.9% to 9,657.30.
Gallagher said there is still a lot of uncertainty in Ireland over whether corporation-tax levels will be increased and this is hurting some otherwise relatively strong Irish companies. There is also continued skepticism over whether the country can keep up with payments under a bailout.
“People are just looking at the numbers and saying we can’t afford to pay back that amount of debt at 5%,” he said.
Among Irish stocks in the red Thursday, shares in airline Ryanair (IE:RY4B 3.89, -0.07, -1.67%) dropped 1.7%.
Also Thursday, LCH.Clearnet again increased the margin required for positions in Irish sovereign debt. The margin now stands at 45%, having risen gradually from 3% as the debt crisis has unfolded.
Among some of the other fallers in Europe, shares in newspaper publisher Daily Mail & General Trust (UK:DMGT 542.00, -22.50, -3.99%) dropped 4.2% in London after the group reported its earnings for the latest fiscal year.
The figures were largely in line with or ahead of market expectations, but analysts said a change to the group’s accounting policy starting in fiscal 2011 could be a concern and would have cut around 7% from its earnings in fiscal 2010.
