Euro shares dive on Wall Street jitters; currency up

LONDON: European stocks fell yesterday, following a downward trend on Wall Street as investors fretted about the possible impact of rising interest rates in the US.

In London the FTSE 100 index of leading shares closed down 0.50% at 5,652.3 points, in Paris the CAC 40 dropped 0.63% to 4,771.24 while in Frankfurt the DAX lost 1.01% to end the session at 5,459.15 points.

The DJ Euro Stoxx 50 index of leading eurozone shares fell 0.79% to 3,506.93 points.

US stocks skidded lower yesterday, giving back gains from the previous day, with the market on edge ahead of a two-day Federal Reserve meeting which is expected to concluded with the central bank raising interest rates by 0.25 percentage points.

The Dow Jones Industrial Average dropped 0.70% to 10,968.44 while the Nasdaq composite lost 0.76% to 2,117.14.

The broad-market Standard and Poor??™s 500 index retreated 0.39% to 1,245.73.

Energy majors got a lift in European trading from the rising price of crude oil.

In London, oil company BP won 0.57% to 613 pence while Royal Dutch Shell added 0.78% to 1,815 pence.

Back in Paris, shares in European steel group Arcelor retreated by 2.12% to 37 euros.

The stock had rocketed by nearly 8.0% the previous day in the wake of the company??™s agreed 27.4bn-euro ($34.4bn) merger with sector rival Mittal Steel. Trading in Arcelor shares had resumed.

Shares in EADS fell 2.95% to 22.08 euros as investors waited for the resolution of a management crisis.

Elsewhere in Europe, in Madrid the Ibex-25 closed down 0.55% at 11,214.5 points, in Milan the SP/Mib index lost 0.55% to 35,393 points, in Amsterdam the AEX closed down 1.04% at 422.80 points and in Brussels the Bel 20 lost 0.49% to 3,570.78 points.

The euro rose slightly against the dollar while the yen hit lows against both currencies after the governor of the Japanese central bank was called on to resign.

The euro climbed to $1.2588 in early European trading from 1.2509 late on Monday in New York.

The yen fell to its lowest level for two months against the dollar, hitting an intra-day low of ??116.70 a dollar, and the currency dropped to its lowest ever level against the euro since the creation of the European currency in 1999 at ??146.64 a euro. ??“ AFP