Ukraine, weak updates hit shares; bonds rise

Tue Apr 15, 2014 7:25am EDT
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By Jamie McGeever

LONDON (Reuters) - Crisis in Ukraine, weak trading updates from European companies and worries over China's economy turned investors sour on riskier assets on Tuesday, driving shares lower and bond prices higher.

German think-tank ZEW said analyst and investor sentiment fell for a fourth month in a row in April, with one economist blaming "gusts of wind" from the East".

Russia said Ukraine, whose Crimea region it annexed last month, was on the brink of civil war. Kiev said an "anti-terrorist" operation against Russian separatists was under way, though any crackdown appeared to be off to a slow start.

U.S. officials have said they were in talks with European partners on how to punish Moscow for what Kiev and its Western allies call a Russian plot to annex Ukraine.

"Things have not improved in Ukraine, and this is weighing on the markets," said Francois Savary, chief investment officer at Swiss bank Reyl.

The FTSE Eurofirst 300 index was down 0.3 percent at 1,315 points, with brewer SABMiller, cosmetics group L'Oreal and foods giant Nestle's producing weak sales reports.

U.S. stock futures edged higher, suggesting a tentative rise on Wall Street later in the day.

However, the focus in Asia was on data showing China's money supply grew at the weakest pace in more than a decade in March, in another sign of softening momentum in the world's second largest economy.   Continued...

Men are reflected in a screen displaying a graph showing the movements of recent share averages outside a brokerage in Tokyo April 11, 2014. REUTERS/Issei Kato