By Jeremy Gaunt, European Investment Correspondent
LONDON, Feb 19 (Reuters) - Hefty bank writedowns from losses
in credit markets rattled European investors on Tuesday while
Asian stock markets were relatively bullish and oil and metal
prices rose unabated.
Platinum reached a new all-time high and gold climbed. Oil
gained more than $1 a barrel. The dollar was weaker against a
basket of major currencies.
Investors' attention in Europe was focused clearly on the
banking sector with sharp reminders from Barclays <BARC.L> and
Credit Suisse <CSGN.VX> that the subprime mortgage crisis
triggered last year is not over.
Barclays said it was raising its 2007 writedown on the value
of risky assets to 1.6 billion pounds ($3.12 billion). Credit
Suisse said it had marked down the value of asset-backed
investments by $2.85 billion.
The impact was to send the pan-European FTSEurofirst 300
<> stock index down nearly 1 percent. The DJ STOXX bank
sector index <.SX7P> lost nearly 2 percent.
Investors have been particularly concerned over recent
months of market turmoil that the full extent of losses from
credit exposure is unknown and a kind of moveable feast of bad
news.
Credit Suisse's writedown announcement, for example, came
only a few weeks after it released its earnings report.
"It has brought all the doubting Thomases out, saying 'Hang
on a minute, is it the end of the write-offs season? Or is there
more to come?'" said David Buik of Cantor Index.
Sentiment outside Europe was more bullish. MSCI's main
emerging market index <.MSCIEF>, for example, was up 0.8 percent
for a month-to-date gain of 2.8 percent.
Japan's Nikkei index <> climbed to a two-week high on
demand for shares in commodity trading houses and exporters. The
benchmark hit a high of 13,853, its highest since Feb. 5, before
paring gains to close at 13,757.91, a rise of 0.9 percent.
HEAVY METAL
Demand for metals continued. Platinum <XPT=> surged to a
record high for the 14th straight session as supply fears
persisted after power shortages in South Africa disrupted
production.
The metal, mainly used in autocatalysts and jewellery,
touched a record high of $2,136 an ounce in Europe.
Gold <XAU=> was up around 0.6 percent at $911.
The rise in gold was partly the result of a weaker dollar.
The U.S. currency sunk to a two-week low against the euro and
fell against the yen while increased expectations of a rise in
Australian interest rates boosted high-yielding currencies.
"We are seeing euro/dollar rallying as people continue to
price in expectations of more negativity on the U.S. macro side,
and the prospect of more rate cuts," said Jeremy Stretch,
strategist at Rabobank.
The euro was up half a percent at $1.4727 <EUR=>, around its
highest in two weeks. The dollar was down 0.4 percent against
the yen at 107.76 yen <JPY=>.
Euro government bond prices were higher as equities fell.
The two-year Schatz yield <EU2YT=RR> was 6 basis points down
at 3.15 percent while the 10-year Bund <EU10YT=RR> was yielding
3.97 percent, down 4 basis points.
(Editing by Mike Peacock)
