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Jun 05, 2020 PRINT EDITION

European stocks end tough year with gains

LONDON: Europe's main stock markets rose on Wednesday, the last trading day of a tough year for the region's equ

December 31, 2014

imageLONDON: Europe's main stock markets rose on Wednesday, the last trading day of a tough year for the region's equities against a backdrop of weak eurozone growth and plunging oil prices.

London's FTSE 100 gained 0.29 percent to end 2014 at 6,566.09 points -- resulting in an annual loss of 2.71 percent for the benchmark index.

London has been dragged down in recent months by low oil prices owing to the FTSE featuring a number of heavyweight energy companies, notably Shell and BP. Economic strains in China have additionally hit the index's mining groups.

"The economic picture materialising out of China has seen a continuing cooling of its economy, not down to levels of Western nations but sufficiently low to see commodity stocks do some serious rescaling of their future expectations," said Alastair McCaig, market analyst at IG trading group.

Elsewhere in thin trading on Wednesday, the CAC 40 in Paris climbed by 0.64 percent to end at 4,272.75 points -- resulting in the index falling 0.54 percent in 2014.

Dealing on Frankfurt's DAX 30 ended for the year on Tuesday, with the index rising by a modest 2.65 percent in 2014 amid sluggish growth in Germany, Europe's biggest economy.

On Wednesday, the euro fell to $1.2140 from $1.2154 late in New York on Tuesday.

"We expect the euro to head down further to a low of $1.15 in 2015 after weakening to a 28-month low of $1.213 in late-December from a 30-month high of $1.399 in early May," said Howard Archer, chief European economist at IHS Global Insight, in a note to clients.

"It is very possible that the euro could weaken further still if the political situation in Greece leads to serious doubts about its eurozone membership."

Greece's parliament was dissolved Wednesday ahead of a snap election warily watched by markets and international creditors concerned that the austerity-weary country could begin to undo fiscal reforms.

"As we look into 2015, the picture is clouded by Greek elections that threaten to reignite the eurozone crisis, while there seems no end in sight to the rout in oil prices," added McCaig.

Markets in recent months have been hit by falling crude oil prices and the Russia-Ukraine crisis, while support has come from the expanding US economy.

"Unlike its European brethren, bar a few wobbles, the US markets had a spectacular 2014, as they consistently hit new record highs in the second half of the year," noted Connor Campbell, analyst at Spreadex traders.

"This especially was true of the Dow Jones, which went on an unprecedented run of gains."

On New Year's Eve US stocks opened slightly higher as Wall Street prepared to close the books on another strong year for equities.

Five minutes into trade, the Dow Jones Industrial Average stood at 18,012.90, up 0.17 percent).

The broad-based S&P 500 added 0.14 percent at 2,083.19, while the tech-rich Nasdaq Composite Index rose 9.69 (0.20 percent) to 4,787.13.

Benchmark oil contract Brent North Sea crude for February delivery hit a fresh five-year low of $55.81 a barrel on Wednesday before recovering slightly, having lost about half of its value since the middle of the year.

US benchmark West Texas Intermediate for February delivery was down $1.33 at $52.79, close to 5.5-year lows and also having shed around half its value in 2014.

Copyright AFP (Agence France-Presse), 2014