LONDON, March 13: European stock markets mostly fell on Tuesday, with London financial shares hit by vague market rumours that a large hedge fund had run into trouble, dealers said.
London's FTSE 100 of leading companies sank 0.21 per cent to 6,220.10 points and Frankfurt's DAX 30 fell 0.10 per cent to 6,708.94, while in Paris the CAC 40 index increased by 0.13 per cent to 5,503.45 points.
The DJ Euro Stoxx 50 index of eurozone blue chip shares drifted 0.08 per cent lower to 4,063.68 points. The euro stood at 1.3177 dollars.
Wall Street had climbed higher on Monday, thanks to falling oil prices and steadier nerves after a recent bout of global turmoil, and despite fears over a shaky mortgage market.
“The market is being hit by talk that a UK hedge fund is about to go bust,”said one London-based trader who wished to remain anonymous.
“We've nothing concrete and don't know if it's commodities related or not.”In London trading, hedge fund manager Man Group saw its shares dive 2.49 per cent to 519 pence, and peer Amvescap slipped 0.50 per cent to 600 pence.
Investors were also edgy after leading US sub-prime lender New Century Corp had warned that its bank backers had cut off their short-term funding, or were preparing to do so. Sub-prime lenders extend credit to borrowers with poor credit histories.
London's banking sector also fell in sympathy, with Royal Bank of Scotland falling 1.24 per cent to 2,066 pence, while Barclays dipped 1.03 per cent to 720 pence.
In Frankfurt, Commerzbank sank 1.10 per cent to 31.42 euros.
Bucking the trend, shares in Alliance Boots jumped 2.96 per cent to 1,026 pence in London, one day after the British pharmacy chain rejected a takeover bid from the group's deputy chairman and US investment group KKR.
In Paris, shares in aerospace group EADS rebounded 2.55 per cent to 22.93 euros following recent losses on concerns over the long-term profitability of its Airbus aircraft unit.
But shares in French media group Lagardere, which owns 15.0 per cent of EADS, fell by 2.83 per cent to 57.33 euros. Late on Monday Lagardere had reported a 56.6-per cent fall in net profit owing to a profits setback already announced by EADS, caused by problems at Airbus.
On Wall Street trading on Monday, the Dow Jones Industrial Average finished 0.34 per cent higher at 12,318.62 points.
The tech-heavy Nasdaq composite jumped 0.62 per cent to 2,402.29, and the broad-market Standard and Poor's 500 index added 0.27 per cent to 1,406.60 points.—AFP