European stocks fall on weaker German confidence


(MENAFN- AFP) Europe's stock markets dropped on Friday as a fall in German business confidence offset positive British growth data, while traders reacted to a huge tie-up of the continent's pay-TV sector.

London's benchmark FTSE 100 index dipped 0.12 percent to stand at 6,813.09 points around midday in the capital, with investors shrugged off the in-line British output data.

In Paris, the CAC 40 shed 0.69 percent to 4,380.13 points and Frankfurt's DAX 30 index lost 0.47 percent to 9,747.71 compared with Thursday's close.

The crises in Ukraine and the Middle East are eroding business confidence in Germany, a key indicator showed on Friday, amid signs that global turmoil could derail European recovery.

The Ifo economic institute's closely watched business climate index fell sharply to 108.0 points in July from 109.7 points in June - the third drop in a row, to the lowest level since October 2013.

Analysts polled by Dow Jones Newswires had expected a smaller dip, to 109.4 points.

In foreign exchange, the European single currency fell to $1.3446 from $1.3464 at the end of a week during which the euro has struck eight-month low points against the US unit as investors sought safety.

The euro eased to 79.22 British pence from 79.25 on Thursday. The pound dropped to $1.6973 from $1.6985.

The price of gold edged higher to $1,293.16 an ounce on the London Bullion Market from $1,292.75 on Thursday.

Britain's economy grew in the second quarter, overtaking the size it achieved before the global financial crisis, official data showed on Friday.

Gross domestic product expanded by 0.8 percent between April and June from the first quarter, when it grew by the same amount, the Office for National Statistics said in a statement.

The economy is now 0.2 percent bigger than before its pre-crisis peak in early 2008, the ONS added.

The International Monetary Fund meanwhile predicts that Britain will be the fastest-growing major world economy this year.

On the corporate side Friday, shares in BSkyB tumbled 4.52 percent to 883 pence after the British satellite television group said it had agreed multi-billion-dollar deals with Rupert Murdoch's media empire 21st Century Fox to create a pan-European pay-TV giant.

Royal Bank of Scotland surged 13.26 percent to 372.4 pence, easily topping London's FTSE 100 index, after the state-rescued lender announced a surge in profits.

In Paris, shares in luxury goods maker LVMH slumped 7.0 percent to 131.35 euros a day after the owner of Louis Vuitton and Givenchy announced a fall to its earnings.


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