Financial markets rounded off another turbulent week on a steadier note yesterday, but fears that the crisis in the US subprime mortgage market could disrupt the global economy persisted.
US equities fell as inflation data reduced hopes for interest rate cuts and worries lingered over a possible spread of the crisis in the subprime mortgage market.
The Dow Jones industrial average ended the day down 49.27 points, or 0.41 per cent, at 12,110.41. The Standard & Poor's 500 Index finished down 5.33 points, or 0.38 per cent, at 1,386.95. The Nasdaq Composite Index closed down 6.04 points, or 0.25 per cent, at 2,372.66.
For the week, the Dow fell 1.35 per cent, the S&P 500 index tumbled 1.13 per cent and the Nasdaq fell 0.62 per cent.
The Irish Stock Exchange continued its modest recovery yesterday as European markets ended broadly stable despite a volatile trading session.
The Dublin market rose 0.69 per cent yesterday but the Iseq index of Irish shares lost a total of €4.5 billion of its value overall during the week, and remained 3.55 per cent lower yesterday afternoon than it was the previous Friday.
Elsewhere in Europe most of the headline indices were fractionally weaker yesterday, though small stocks fared better. The EuroStoxx 50 index ended the day just over one point or 0.03 per cent weaker on 3,984.54.
In Japan, the Nikkei 225 Average closed down 0.7 per cent at 16,744.15, leaving it 2.4 per cent lower on the week. All the main international markets are down on the year.
A very strong performance by C&C helped the Dublin market to buck the international trend. The stock rose 8.67 per cent, or 85 cent, to close on €10.65 amid rumours that someone was building a stake in the company.
In the US, data yesterday showed stronger-than-expected growth in industrial production in February, but also slightly weaker-than expected consumer confidence in March.
Consumer price inflation, while in line with expectations, was interpreted as giving the US Federal Reserve little scope to cut interest rates in the near future.
Concerns about a US slowdown also had an impact in currency markets where the dollar fell to its lowest level against the euro for three months.
This took the focus away from the Japanese yen, which has been at the centre of currency market turbulence in recent weeks, amid talk of an unwinding of the global carry trade.
This trade involves investors borrowing low-yielding currencies (such as the yen) to invest in higher yielding assets elsewhere.
Given the growth concerns, base metal prices proved remarkably resilient, with nickel prices hitting a series of new daily records this week.
Crude oil fell in technically driven trade, weighing on energy shares. US crude for April delivery was 35 cents lower at $57.20 per barrel in late trade.
Benchmark April gold rose $6.80 to finish at $653.90 an ounce, due to the slumping dollar. - (Additional reporting: Financial Times /Reuters)
