Technology sell-off sends markets tumbling

Tumbling technology share helped trigger the biggest decline in European markets in a month yesterday.

Traders in Dublin said weakness that had been evident in the US late on Friday fed across the Atlantic yesterday, contributing to a slide across Europe that left the Irish market trailing by around 1 per cent.

The Stoxx Europe 600 Index fell from a six-year high. Traders blamed a fall in technology and biotech companies, favoured by investors recently, for the tumble.

DUBLIN
There was a "pretty broad sell off" across most stocks, traders in Dublin said yesterday. Property investment vehicle, Green REIT , was one of those that bucked the trend, gaining almost 3 per cent at one stage, before sliding back to close 0.77 per cent ahead at €1.18.

The company announced on Friday that it intends raising €400 million through a share placing priced at €1.12.

CRH was another significant mover, closing 0.63 per cent down at €21.265. The building materials giant, the largest component of the Iseq index of Irish shares, was up almost 2 per cent at one point as investors saw it as likely to benefit from the proposed merger of rivals Lafarge and Holcim. Around 2.2 million CRH shares changed hands in Dublin yesterday, slightly more than usual.

Petroceltic tumbled 2.86 per cent to €2.04 after the company announced that it had stopped exploring one area of its Kurdistan licence after finding only limited quantities of oil and gas.

LONDON
Smartphone chipmaker, ARM Holdings lost 2.3 per cent to 973.5 pence. Ocado Group , the online grocery service, slid 6.7 per cent to 422 pence. The company, which delivers groceries from Waitrose and Wm Morrison trades at 151-times forward earnings. Burberry retreated 2 per cent to 1,406 pence. Berenberg cut the stock to hold from buy.

API Group slumped 7.4 per cent to 68.5 pence after saying earnings for the year ended in March will only reach the lower end of its forecasts.

Marks and Spencer Group fell 2 per cent to 452.9 pence. Executive director for food Steve Rowe acknowledged that price cuts by the big four supermarket chains would shake up food retailing in Britain.

Centrica gained 1.9 per cent to 334.8 pence after National Grid forecast adequate electricity margins in the UK throughout the summer, according to the utility company's outlook for 2014.

EUROPE
United Internet declined 4.1 per cent to €34.14. Iliad SA slid 5.5 per cent to €198.50. Osram Licht retreated 6.7 per cent to €44.36. Berenberg Bank cut the lighting manufacturer to hold from buy, meaning it no longer recommends acquiring shares.

Altice jumped 11 per cent to €33.57, while Bouygues lost 6.3 per cent to €28.88. Cable billionaire Patrick Drahi's Altice will pay €13.5 billion in cash and give Vivendi 20 per cent of the company created from a merger of its Numericable Group with SFR. Vivendi added 0.3 per cent to €20.61. Alfa Laval gained 1.3 per cent to 179.90 kronor.

The maker of heat exchangers agreed to buy Norwegian pumpmaker Frank Mohn for 13 billion kroner to capture spending in offshore oil and gas drilling.

US
US investors also moved towards more defensive stocks yesterday. Pfizer was down 3 per cent to $31.17. Specialty pharmaceuticals company Mallinckrodt agreed to buy drugmaker Questcor Pharmaceuticals for about $5.6 billion to gain access to its multiple sclerosis drug, Acthar Gel.

Questcor shares climbed 13.5 per cent to $77.05 while Mallinckrodt dropped 9.4 per cent to $56.65.

MannKind slumped 10 per cent to $6.18. The company said the US Food and Drug Administration extended the review date of its inhaled insulin treatment by three months. – (Additional reporting: Bloomberg, Reuters)