Oil weighs on shares as dollar sags

LONDON – European stock markets fell and the dollar toyed with multi-month lows yesterday as US crude topped US$55 a barrel and investors prepared for a busy week of company results.

US stock index futures indicated a weak opening on Wall Street as investors braced for quarterly figures from global technology bellwether International Business Machines. Government bonds were steady as traders fretted about the drag on growth generated by rising fuel costs, despite Fed Chairman Alan Greenspan’s efforts to play down the impact and keep the way open for further rises in US interest rates.The FTSEurofirst 300 index of leading European eased 0,2 per cent to 993 points.The Dax and FTSE 100 benchmarks were also slightly weaker after failing to hold above key support at 4 000 and 4 700 points earlier this month as an autumnal rally ran out of steam, undermined by nagging oil-related economic worries.”I think there is a lot of uncertainty and oil is clearly the main problem.Without any break in oil prices I don’t think you will get a sustained rally soon,” said Nigel Cobby, managing director of European equities at JP Morgan bank.Insurance stocks such as Swiss Re and Allianz led the blue-chip fallers in Europe for a second straight session as the sector continued to reel from last week’s news of a US lawsuit alleging manipulation in the United States, where many European insurance providers are active.New York Mercantile Exchange (NYMEX) US crude oil futures rallied to a new record of US$55,33 a barrel before pulling back, amid continuing concerns over a potential winter fuel supply crunch.Oil has jumped about US$20 in less than four months, spurred most recently by an outage in US Gulf production, which is operating at 73 per cent of normal output due to hurricane-related pipeline and platform damage.-Nampa-ReutersGovernment bonds were steady as traders fretted about the drag on growth generated by rising fuel costs, despite Fed Chairman Alan Greenspan’s efforts to play down the impact and keep the way open for further rises in US interest rates.The FTSEurofirst 300 index of leading European eased 0,2 per cent to 993 points.The Dax and FTSE 100 benchmarks were also slightly weaker after failing to hold above key support at 4 000 and 4 700 points earlier this month as an autumnal rally ran out of steam, undermined by nagging oil-related economic worries.”I think there is a lot of uncertainty and oil is clearly the main problem.Without any break in oil prices I don’t think you will get a sustained rally soon,” said Nigel Cobby, managing director of European equities at JP Morgan bank.Insurance stocks such as Swiss Re and Allianz led the blue-chip fallers in Europe for a second straight session as the sector continued to reel from last week’s news of a US lawsuit alleging manipulation in the United States, where many European insurance providers are active.New York Mercantile Exchange (NYMEX) US crude oil futures rallied to a new record of US$55,33 a barrel before pulling back, amid continuing concerns over a potential winter fuel supply crunch.Oil has jumped about US$20 in less than four months, spurred most recently by an outage in US Gulf production, which is operating at 73 per cent of normal output due to hurricane-related pipeline and platform damage.-Nampa-Reuters