UpdateEurope chems close down in weaker market

22 October 2007 17:49  [Source: ICIS news]

(Recasts and updates with closing index and stock prices)

LONDON (ICIS news)--Chemicals stocks were hit hard on Monday as European financial markets traded lower following the market downturns in the US and Asia.

The Dow Jones Eurostoxx Chemicals Index closed 1.86% lower at 492.74 while the Eurostoxx 50 index closed off 1.25% at 4356.24.

Among the hardest hit chemicals stock in the region were DSM, down 2.41% at €38.11 ($54.44), Rhodia, down 2.62% at €27.13 and Bayer, down 3.44% at €58.16.

The US market had reacted negatively to the 20th anniversary of "Black Monday" on Friday and ongoing pressure on the US economy driven by the subprime mortgage meltdown.

The Dow Jones index had dropped 2.66% and Asia markets stuttered on Monday with the Nikkei index down 2.24% at the close and the Hang Seng index 3.7% lower.

Some European chemicals stocks were less affected by the downward pressure. BASF was down 1.18% on the Xetra exchange at €95.43 and ICI was down just 0.15% at 657p on the London market.

Also in London, Royal Dutch Shell was off 1.46% at 2021p, while BP was down 0.98% at 605.00p. The FTSE 100 index closed down 1.05% at 6459.30. In Paris, Total was down 1.52% at the close at €55.01.

The third-quarter results season for the sector begins in earnest this week but financial analysts were relatively upbeat about performance.

The signals on European trading generally remained positive, Citigroup analysts said in a note to clients on Thursday.

Basic chemicals producers should have been helped by higher basic petrochemical costs, they said, adding currencies and cost pressures were expected to make trading tougher for the added value companies.

($1 = €0.70)

By: Nigel Davis
+44 20 8652 3214

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