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European shares fall in early trade, banks lead

European shares fall in early trade, banks lead
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First Published: Thu, Jan 07 2010. 01 45 PM IST
Updated: Thu, Jan 07 2010. 01 45 PM IST
London: European shares fell back from a closing 15-month high on Thursday, with banks taking most points off the index, and ahead of the Bank of England’s decision on interest rates.
At 0809 GMT, the FTSEurofirst 300 index of top European shares was down 0.5% at 1,055.49 points, having hit a 15-month closing high on Wednesday.
The European benchmark is still up more than 63% from its lifetime low of 9 March 2009.
The heavyweight banking sector took most points off the index. Banco Santander, Barclays, Credit Suisse and HSBC fell between 0.6 and 0.7%.
On Wall Street, the S&P also hit another 15-month high on Wednesday. “Markets may take a breather today, but that’s a buying opportunity,” said Franz Wenzel, strategist at AXA Investment Managers in Paris.
“Growth is recovering and we think the reporting season, which starts next week, will be good. The European markets are still following the US master.”
Supermarket group J Sainsbury rose 2% after beating third-quarter sales growth forecasts, as rising customer numbers and strong sales of non-food ranges offset lower food price inflation.
The Bank of England is likely to announce at 1200 GMT that it is keeping interest rates on hold at a record low of 0.5%, and maintaining the quantitative easing programme at 200 billion pounds of asset purchases.
Later, investors’ attention will switch to the United States, where weekly jobless claims data is due.
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First Published: Thu, Jan 07 2010. 01 45 PM IST