European markets retreat amid US holiday

(MENAFN- AFP)Europe's major stock markets retreated on Monday in subdued trading on a public holiday in the United States.

London sentiment was knocked by news that British construction group Carillion has collapsed, which weighing in particular on share prices of its joint venture partner companies.

Wall Street is closed on Monday owing to a US public holiday.

The euro meanwhile soared to a three-year peak at $1.2269 as Germany's preliminary coalition deal calmed eurozone nerves.

"It has been an uninspiring start to the week, with market volumes and volatility expected to be muted given the absence of US activity as the nation respects Martin Luther King day," said analyst Joshua Mahony at trading firm IG.

"The incredible recent rise in US stocks has certainly laid the groundwork for significant upside across a number of indices of late, and the majority of Asian markets had a strong start to the week."

- Carillion collapses -

Carillion announced its immediate liquidation on Monday after the heavily-indebted British contractor failed to secure a financial rescue from the UK government or banks in last-ditch talks.

The company's share price, which tumbled 28.95 percent to 14.20 pence in reaction, was subsequently suspended by London's Financial Conduct authority regulator.

Carillion, which employs 43,000 staff worldwide including 19,500 in Britain, said that the government would nevertheless provide some funding to allow current state projects to continue, following talks over the weekend.

"Carillion's collapse continued to dominate what would have otherwise been a very quiet start to the trading week," noted Spreadex analyst Connor Campbell.

"Much of the morning has seen Carillion’s peers and partners let investors know whether or not they will be hurt by the company's liquidation."

Balfour Beatty, which has three joint venture construction schemes with Carilllion, saw its share price slide about 2.5 percent after warning over the impact of the collapse.

- Asia's blistering start -

Asian traders continued their blistering start to the year on Monday with most markets rising but Hong Kong's record rally came to an end.

Wall Street once again provided a strong lead on the back of optimism about corporate earnings in light of Donald Trump's tax cuts as well as the improving global economic outlook.

Hong Kong started the day on a high -- pushing on with a run of gains into the 15th day and heading for its all-time high -- but profit-taking eventually caught up with it and the benchmark index closed down 0.2 percent.

The Hang Seng Index climbed more than seven percent in its run, supported by a surge in mainland investors attracted by relatively cheaper valuations compared with Shanghai and Shenzhen.

- Key figures around 1200 GMT -

London - FTSE 100: DOWN 0.1 percent at 7,768.14 points

Frankfurt - DAX 30: DOWN 0.4 percent at 13,188.78

Paris - CAC 40: DOWN 0.2 percent at 5,505.03

EURO STOXX 50: DOWN 0.1 percent at 3,607.83

Tokyo - Nikkei 225: UP 0.3 percent at 23,714.88 (close)

Hong Kong - Hang Seng: DOWN 0.2 percent at 31,338.87 (close)

Shanghai - Composite: DOWN 0.5 percent at 3,140.49 (close)

New York - DOW: UP 0.9 percent at 25,803.19 (close)

Euro/dollar: UP at $1.2263 from $1.2195 at 2200 GMT Friday

Pound/dollar: UP at $1.3793 from $1.3731

Dollar/yen: DOWN at 110.56 yen from 111.06 yen

Oil - Brent North Sea: DOWN three cents at $69.84 per barrel

Oil - West Texas Intermediate: UP two cents at $64.32

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