European shares remained unchanged amid confusion over the economic impact of the tsunami that hit Asia over the weekend. Insurance and travel stocks moved lower while construction and steel made gains.
The FTSE Eurofirst 300 index of leading European shares was unchanged at 1,042.22, while France’s CAC-40 rose 0.1 per cent to 3,827.66 and Germany’s Xetra Dax edged up 0.1 per cent to 4,256.77. Trading was light with London markets closed for a holiday.
The strength of the euro against the dollar limited any gains from Europe’s exporters as it posted a fresh record high for the third day in a row. The euro hit highs around $1.3555 in early trade amid growing market confidence that Europe’s central bank will not intervene to stem the currency’s rise. The euro also hit 18-month highs against the yen as the market assessed the economic impact of the Asian tsunami, reaching Y140.70. By midday, the euro pulled back to $1.3530 against the dollar and Y140.40 against the yen.
Europe’s largest insurers said that it was too early to assess the impact of the tsunami in Asia that killed more 15,500 people. However, the sector was marked down across the board. Germany’s Munich Re fell 1.9 per cent to €89.74, Swiss Re lost 2.1 per cent to SFr 80.95 and France’s Axa moved 0.4 per cent lower to €18.28.
Travel related stocks were also maked lower, with German airline Lufthansa falling 0.8 per cent to €10.39 and TUI Group, a German travel company, falling 1.6 per cent to €17.65.
However, there was a boost for the construction sector. French building materials provider Saint Gobain rose 1 per cent to €44.89, Vinci, the world’s largest construction company, rose 0.5 per cent to €98.85 and Ferrovial, the Spanish construction group, rose 0.6 per cent to €39.54.
Arcelor, the world’s second biggest steelmaker, also made gains, rising 0.5 per cent to €16.86./www.news.ft.com/