Global Markets Diverge after Syria Strike
Asian and European equities diverged Monday in a muted reaction to US-led strikes on Syria, dealers said.
In late morning European deals, Frankfurt forged 0.2 percent higher and Paris turned flat, while London slid 0.3 percent on the rising pound and the faltering energy sector.
The United States, Britain and France carried out attacks at the weekend on alleged chemical weapons facilities, in response to what they say was a toxic gas attack by the Russia-backed Assad regime a week before.
"Even though investors have moved past the Syria missile strikes and are working on the basis that there will be no extended conflict or market-adverse retaliation, equity markets are struggling for direction," noted Interactive Investor analyst Rebecca O'Keeffe.
"This lack of positive reaction is a potential concern and is an indication that investors are wary."
- Wary investors -
Most Asian markets dipped Monday but Tokyo eked out gains, as a U.S.-led strike on Syrian targets fueled fresh concerns over the tinderbox Middle East.
London's benchmark FTSE 100 index lost ground as the strong pound weighed on the share prices of multinationals earning large amounts in other currencies.
The commodities-heavy FTSE was also weighed down as oil prices slid, dragging the energy sector lower with BP down 1.6 percent at 495.90 pence.
"The strike on Syrian chemical locations over the weekend marks the end of the recent standoff," noted IG analyst Joshua Mahony.
"Market realization that this attack largely draws the line under the issue has brought about a sharp decline in oil prices in early trade, hitting BP shares in particular."
The troubles in the oil-rich Middle East have helped push the price of crude to highs not seen since the end of 2014, though the market dropped on Monday.
While there was broad support for the Syria mission, Moscow condemned it as illegal and warned it would provoke "chaos" in international relations.
The Syria crisis, which has seen the West's relationship with Russia grow increasingly frosty, has encompassed other regional players including Iran, Saudi Arabia and Israel, and led to talk of a military standoff.
It also comes against the backdrop of a trade dispute between the United States and China. Many fear this could hammer the global economy if the two sides push through tit-for-tat tariffs on billions of dollars' worth of goods.
- WPP tumbles -
British advertising and marketing group WPP topped the FTSE fallers after chief executive Martin Sorrell resigned over the weekend.
Sorrell's departure came 10 days after WPP launched an independent probe into allegations of his personal misconduct through the misuse of company assets.
The company, widely regarded as a bellwether for the global advertising industry, saw its stock dive 5.8 percent to 1,119 pence.
"WPP has been losing ground in the advertising world recently, as traditional advertising is losing out to online and social media marketing," said CMC Markets analyst David Madden.
"Sir Martin was an integral part of WPP, and some market confidence has been lost now that he is no longer at the helm."
- Key figures around 1045 GMT -
London - FTSE 100: DOWN 0.3 percent at 7,241
Frankfurt - DAX 30: UP 0.2 percent at 12,465.56
Paris - CAC 40: FLAT at 5,316.24
EURO STOXX 50: UP 0.1 percent at 3,451.22
Tokyo - Nikkei 225: UP 0.3 percent at 21,835.53 (close)
Hong Kong - Hang Seng: DOWN 1.6 percent at 30,315.59 (close)
Shanghai - Composite: DOWN 1.5 percent at 3,110.65 (close)
New York - Dow: DOWN 0.5 percent at 24,360.14 (close)
Euro/dollar: UP at $1.2364 from $1.2331 at 2100 GMT
Dollar/yen: DOWN at 107.21 yen from 107.35
Pound/dollar: UP at $1.4268 from $1.4238
Oil - Brent North Sea: DOWN 91 cents at $71.67 per barrel
Oil - West Texas Intermediate: DOWN 84 cents at $66.55