Petrofac shares plunge
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European stocks swung between gains and losses Thursday, hampered by lower volume and a slide in oil prices following news the Organization of the Petroleum Exporting Countries will hold back from making deeper production cuts.
The Stoxx Europe 600 fell less than 1 point to 392.22, but has been darting in and out of positive territory. Utilities, telecom and consumer goods shares were holding higher, but commodity shares were putting in the worst performance.
While major stock exchanges were open Thursday, Germany and Switzerland were among the countries observing the Ascension holiday.
Germany's DAX was down 0.1% at 12,625.99, but itself has been higher during the session.
Intraday, the "DAX took a 100+ point plunge in the space of a few minutes. This looks likely to be the result of a bank holiday in Germany that makes for thinner liquidity and higher volatility as a result," said Neil Wilson, senior market analyst at ETX Capital, in a note.
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"It's all very thin and choppy out there with French banks also closed today."
France's CAC 40 index was back down by less than 1 point at 5,339.97. Italy's FTSE MIB was down 0.6% while Spain's IBEX 35 pared its gain to 0.4%.
The U.K.'s FTSE 100 was fractionally lower at 7,513.56 (http://www.marketwatch.com/story/ftse-100-wobbles-with-opec-decision-in-sight-2017-05-25)in choppy trade.
Oil: The Stoxx Europe 600 Oil & Gas Index fell 0.9%, reversing course after oil prices sank roughly 2% (Oil%20slides%20below%20$51%20as%20OPEC%20agrees%20on%209-month%20output%20extension) after Saudi Arabia's oil minister Khalid al-Falih ruled out deeper cuts to oil production in any extension to an OPEC output deal.
OPEC's official announcement wasn't expected to arrive before 4 p.m. London time, or 11 a.m. Eastern Time, but reports, citing unidentified sources, say a deal has been reached for a nine-month extension to output cuts.
Read:OPEC says it will extend production cuts through March 2018 (http://www.marketwatch.com/story/opec-says-it-will-extend-production-cuts-through-march-2018-2017-05-25)
Oil prices have been climbing in recent weeks in anticipation that OPEC and non-OPEC members would extend production cuts that were agreed last November as they worked to tackle global oil oversupply. But investors appeared disappointed that deeper cuts won't be featured in an agreement.
In the European oil group, Italian oil producer Eni SpA (ENI.MI) dropped 1.4%, BP (BP.LN) (BP.LN) gave up 1% and France's Total SA (TOT) (TOT) shed 0.7%. Among oil services providers, Amec Foster Wheeler PLC (AMFW.LN) fell 6.7% and Saipem (SPM.MI) gave up 2.3%.
Read:4 potential outcomes for OPEC's crucial meeting (http://www.marketwatch.com/story/4-potential-outcomes-for-opecs-crucial-meeting-2017-05-19)
Meanwhile, shares of Petrofac Ltd. (PFC.LN) plunged 30% after the oil services company said it suspended Chief Operating Officer Marwan Chedid until further notice (http://www.marketwatch.com/story/petrofac-suspends-coo-as-uk-conducts-probe-2017-05-25). Petrofac is under U.K. investigation on suspicion of bribery, corruption and money laundering, and the company has said it's cooperating with authorities. Chedid has resigned from Petrofac's board.
Stock movers: Daily Mail & General Trust PLC (DMGT.LN) slid 6.9% after posting a 76% fall in pretax profit (http://www.marketwatch.com/story/daily-mail-general-trust-pretax-profit-slides-2017-05-25) for the first half of fiscal 2017 as it booked costs related to the company's restructuring. The result was in line with the expectations set by the company, whose portfolio of businesses include the Daily Mail newspaper.
Intesa Sanpaolo SpA shares (ISP.MI) fell 1.2% after a downgrade of the Italian lender to hold from buy at Jefferies, which said "valuation looks full with catalysts near-term less clear." A price-target lift to EUR2.90 from EUR2.70 a share no longer leaves sufficient upside to justify a buy rating, Jefferies said in a note about European banks.
Meanwhile, the euro was buying $1.1215, not far off from $1.1220 logged late Wednesday in New York. The U.S. dollar was choppy late Wednesday after minutes from the Federal Reserve's latest policy-setting meeting showed policy makers appeared set to start shrinking the bank's massive balance sheet.
The minutes also showed that most Fed officials said it would "soon" be time to raise rates again.
Read:Seeing another rate hike 'soon,' Fed outlines plan to reduce bond holdings, minutes show (http://www.marketwatch.com/story/seeing-another-rate-hike-soon-fed-outlines-plan-to-reduce-bond-holdings-minutes-show-2017-05-24)
(END) Dow Jones Newswires
May 25, 2017 07:51 ET (11:51 GMT)