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European stocks end winning streak

European stocks end winning streakLONDON: European stocks reversed on Tuesday as volatile commodity prices and company results hit shares, giving up some of the gains won over the previous nine trading days as the Greek debt crisis eased.

London’s benchmark FTSE 100 index of top companies slid 0.29 percent to close at 6,769.07 points.

In the eurozone, the CAC 40 in Paris shed 0.70 percent compared with Monday’s close to 5,106.57 points, while Frankfurt’s DAX 30 fell 1.12 percent to 11,604.80 points.

“After a nine-day positive run leading out of the Greek debt crisis, European shares dropped back on Tuesday with poor results from pharmaceutical giant Novartis acting as a drag on Europe’s healthcare sector,” said market analyst Jasper Lawler at CMC Markets UK.

Swiss pharmaceutical giant Novartis reported $ 4.1 billion (3.8 billion euros) in income for the first half of the year, down 20 percent, due largely to a stronger dollar. Novartis shares lost 2.05 percent to close at 100.20 Swiss francs on the Zurich stock market.

“The market is catching its breath after a rather bullish series,” said Andrea Tueni, an analyst at Saxo Banque of Tuesday’s market retreat in Europe.

“It seems normal after an enormous rebound of 10 percent in the last 10 sessons,” added Xavier de Villepion, a trader at HPC.

In foreign exchange, the euro strengthened to $ 1.0920 from $ 1.0824 late in New York on Monday, when it had earlier hit a near three-month low point at $ 1.0809.

Earlier Tuesday, the dollar climbed to a five-week high against the yen on growing expectations the US Federal Reserve will raise interest rates this year.

“The strong USD continues to weigh on market sentiment adding pressure to most commodity prices,” said Myrto Sokou, senior research analyst at Sucden Financial.

New York-traded crude briefly fell below $ 50 a barrel as demand for the dollar-priced commodity took a hit from a strong US currency and looming return of Iranian supplies, analysts said.

US stocks fell Tuesday following disappointing earnings from IBM and United Technologies, as the market looked ahead to results from Apple later in the day.

In New York mid-day trade, the Dow Jones Industrial Average stood at 17,900.01, down 1.11 percent.

The broad-based S&P 500 shed 0.41 percent to 2,119.50, while the tech-rich Nasdaq Composite Index slipped 0.30 percent to 5,203.32.

Markets are keeping a close eye on the Fed as it considers its first rate rise since 2006 with the US economy getting back up to speed.

In Europe, Bank of England governor Mark Carney has indicated that Britain’s record-low interest rate could also soon start to rise.

The BoE chief last week said he expected the key rate to climb over the next three years from its current level of 0.50 percent — where it has stood for more than six years to help stimulate growth after the global financial crisis.

Asian markets advanced Tuesday, with Tokyo boosted 0.93 percent by a weaker yen and Shanghai’s recovery continuing with a 0.64 percent gain, while Hong Kong added 0.52 percent.

Copyright AFP (Agence France-Presse), 2015

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