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2006-08-10 :: European Terror Plot Hits Markets

Below is a story that will likely have an impact on the markets today, giving the traders in New York one more thing to worry about. 

News story from CBS Marketwatch…

European markets sharply lower on terror concerns

Airlines, travel stocks hit by renewed terror fears

LONDON (MarketWatch) — European markets traded sharply lower on Thursday, as renewed terrorist fears hit airline stocks in a market already under pressure from an overnight sell-off in the U.S. equity markets and some poorly received earnings news from Deutsche Telekom.
The U.K. FTSE 100 index (UK:UKX: news, chart, profile) lost 1.3% at 5,784, the German DAX Xetra 30 index (DX:1876534: news, chart, profile) declined 1.9% at 5,593 and the French CAC-40 index (FR:1804546: news, chart, profile) fell 1.4% at 4,955.
The pan-European Dow Jones Stoxx 600 index (ST:SXXP: news, chart, profile) dropped 1.2% at 322.56, with travel and telecom stocks leading decliners as both sectors dropped more than 2% in the index.
London-listed airlines lost ground, with British Airlines (BAB :

British Airways Plc ImageBAB73.33, +1.47, +2.0% ) (UK:BAY: news, chart, profile) down 4%, EasyJet (UK:EZJ: news, chart, profile) 2.5% lower and Ryanair (UK:RYA: news, chart, profile) (RYAAY :ryanair hldgs plc sponsored adrRYAAY54.50, -2.06, -3.6% ) down 3.9% after U.K. authorities said that they arrested at least 25 people in a plot to blow up as many as 6 airplanes flying between the U.K. and the U.S., according to media reports:
 

“It’s undoubtedly caught people off guard, everyone’s looking at the airlines of course,” said Mark Tinker, head of strategy at brokerage Execution,.
He added that the market has generally been lacking in confidence and news such as Thursday’s provides an excuse to stay away.
The travel sector rout spilled over to the Continent, with Spanish construction group Ferrovial (ES:016260101: news, chart, profile) , which has agreed to buy Heathrow and Gatwick airport operator BAA, down 1.9% and German airline Deutsche Lufthansa (DE:823212: news, chart, profile) down 4.7%.
Travel company TUI (DE:TUAG00: news, chart, profile) lost 6% and Air France-KLM (AKH :

air france klm sponsored adr  AKH25.24, -0.03, -0.1% ) (FR:003112: news, chart, profile) declined 4.1%. Both companies also updated investors on progress Thursday.

Traders said that Thursday’s European moves were a combination of the new terror fears and technical factors.