Defensives favoured in volatile markets

Early March saw continental European equity markets fall to record lows as weak corporate data coincided with renewed fears of a war in Iraq. France's CAC 40 index sank below the 2,600 mark, its lowest level for five years. A massive corporate loss reported by Vivendi on 6 March helped to undermine the market. In Frankfurt, meanwhile, shares sunk to seven-year lows, with the DAX falling to 2,411. This was due in part to a statement from the Bundesbank warning that Germany could be facing a protracted period of weakness. After an initial burst of enthusiasm to herald the New Year, ...