US shutdown weighs on global markets

The Iseq dipped for a second day along with many exchanges globally, as a shutdown of the US government continued and a gauge of service-industry activity in the world’s biggest economy fell more than forecast.

The shutdown has had a limited effect on markets so far, but the impact is gathering strength as concerns over raising the US’s borrowing authority deepen.

The euro zone’s blue-chip Euro STOXX 50 index closed down by 0.6 per cent. The UK’s FTSE 100 bucked the trend, added 0.2 per cent, while France’s CAC 40 fell 0.7 per cent. Germany’s DAX fell 0.4 per cent, while the Iseq also slipped a fraction.

DUBLIN
Aminex, an Africa-focused exploration penny stock, was the exchange's biggest climber. Investors have been excited by the potential of its gas assets in Tanzania. The share price rose more than 10 per cent, but on low volumes. The share price is still just 3.2c.

CRH fell back by about 2.5 per cent on heavy volumes. The stock is particularly sensitive to economic data from the US, where sentiment is weighed down by the debt ceiling row. It closed yesterday at €17.41.

C&C remained broadly flat, dipping by just 0.14 per cent, although volumes were relatively heavy. Almost five million shares in the Magners/Bulmers cider maker changed hands, in almost 1,500 deals. It closed at €4.18.

LONDON
Aviva climbed 1.4 per cent to £4.13 after saying the sale of its US life-insurance and annuities business to Athene Holding generated proceeds of $2.6 billion, higher than the $1.8 billion purchase price disclosed in December.

BP advanced 1.1 per cent to £4.37 as the US Court of Appeals asked a judge to review his interpretation of some of the terms of a settlement reached with Gulf of Mexico spill victims' lawyers in 2012. The oil company said the programme's administrator was approving payment of millions of dollars in "fictitious" losses based on a flawed interpretation of the agreement.

Sports Direct International, the UK's largest sports retailer and the co-owner of the Irish department stores Heatons, dropped 1.5 per cent after company executives sold about 3.9 million shares. The stock declined 10.5p to £6.98.

EUROPE
Schibsted, Norway's biggest media group, rallied 6.6 per cent to 337.20 kroner, its highest price since at least 1992, after Goldman Sachs began coverage with a buy rating, citing earnings-growth potential for its online classifieds business.

Gerresheimer, the maker of pharmaceutical and health-care equipment, declined 2 per cent to €44.68 as Credit Suisse cut its recommendation on the stock to neutral from outperform. The brokerage also lowered its full-year earnings estimates through to 2015.

K+S, a German potash producer, gained 2.9 per cent to €19.15. Russia has told bidders for Suleiman Kerimov's 22 per cent stake in OAO Uralkali that the world's biggest potash maker should resume cooperation with its Belarusian rival, Dow Jones reported. The $20 billion potash market was "paralysed" after the two companies ended a joint venture in July,

NEW YORK
United Technologies lost 1.6 per cent to $103.34. The military contractor said the shutdown will force it to lay off as many as 5,000 employees. The first effect will be layoffs for about 2,000 Sikorsky Aircraft employees in Connecticut, Florida and Alabama on Monday.

Eli Lilly lost 3.6 per cent to $48.71. The drugmaker said a slowdown in emerging markets and the weakening of the yen will make it "challenging" for it to meet its 2014 sales target. Lilly also plans to repurchase $5 billion of shares over time, the company said.

(Additional reporting: Bloomberg/Reuters)