Dark clouds from the financial sector overshadowed gains by commodities and fertiliser stocks, leaving European bourses flat after a volatile day’s trade.
The FTSE Eurofirst 300 ended unchanged at 1,346.08 points as French banks followed their peers across the channel firmly into the red.
Crédit Agricole fell 5.6 per cent to €19.56 as it said it was planning a €5.9bn rights issue after writedowns at its Calyon investment banking arm. The bank will decide on whether to pursue a rights issue at a board meeting on Wednesday.
Belgian-Dutch bank Fortis fell 1.4 per cent to €16.72 after missing forecasts with a 31 per cent fall in first-quarter net profit because of asset impairments after the credit crunch.
Société Générale, hit by the worst recorded rogue trading scandal, reported first-quarter profit down 23.4 per cent. Although net profit came in above market expectations, the shares fell 0.8 per cent to close at €70.90.
Domestic peer Natixis sank 3.3 per cent to €10.71 as investors braced themselves for a second consecutive quarterly loss from the bank tomorrow.
Bank of Ireland fell 4.4 per cent to €8.8 tracking its peers in the UK lower after poor inflation data.
Hermès, the luxury goods group famed for its scarves and Kelly handbags, topped the loser board on the Eurofirst 300, fell 8.3 per cent to €97 as speculative gains, which drove it to a record high on Monday, evaporated. Analysts scotched takeover talk partly because Hermès is a limited partnership, which makes any hostile bid unlikely.
Oil groups rose in early trade and then slid, tracking the wider market lower, in spite of robust results.
Spanish oil group Repsol said inventory gains and record prices helped it achieve a forecast-beating 16.5 per cent rise in first-quarter net profit. The shares fell 0.7 per cent at €26.25, erasing early gains. Sacyr-Vallehermoso, which owns a 20 per cent stake in Repsol, rose 1.2 per cent to €22.90.
Norwegian rival StatoilHydro softened 1.3 per cent to NKr191.30 in early trade after reporting a bigger jump than expected in first-quarter operating profit, helped by record oil prices. Although production costs rose sharply, it said these were offset by lower inventory writedowns, gains from asset sales and currency gains.
France’s Total ended 0.8 per cent higher at €54.55.
Norsk Hydro, which last year sold its oil and gas assets to Statoil, gained 4.3 per cent to NKr78.10. Analysts said gains in aluminium prices and projections of supply problems after the earthquake in China would help boost the stock.
Austria’s Voestalpine rose 3.9 per cent to €50.70 catching up with gains by other metals stocks on Monday, when the Austrian stock exchange was closed for a public holiday.
ArcelorMittal extended its climb, rising 1 per cent to €62.16, while French steel tubemaker Vallourec rose 3.5 per cent to €184.92.
Deutsche Bank raised its price target on potash fertiliser maker K&S to €340 from €265 citing strong growth in agricultural prices.
Matthias Pfeifenberger, analyst, said: “With global grain inventories on multi-decade lows and food demand alarmingly rising, agflation is set to continue.”
He added that with substantial growth triggers ahead he expected K&S to raise its full-year guidance.
The German company, which reports first-quarter results today, rose 4 per cent to €295.70.
Yara International, Norwegian agrichemicals group, rose 2.8 per cent to NKr405.50.
