Gains in European stocks curtailed as Gazprom declares force majeure

European markets trimmed early gains after Russia’s Gazprom declared force majeure on gas supplies to at least one major customer in Europe, according to a letter from the energy giant.

The letter, seen by Reuters, said Gazprom, which has a monopoly on Russian gas exports by pipeline, could not fulfil its supply obligations owing to “extraordinary” circumstances outside its control. A trading source said the letter concerned supplies through the Nord Stream 1 pipeline that brings gas to Germany.

Stocks had risen ahead of the well-flagged announcement expected from the European Central Bank (ECB) on Thursday to raise interest rates for the first time in more than a decade, with a hike of 25 basis points expected.

Dublin

The Iseq rose 1.4 per cent in light volumes across many stocks, echoing the positive mood among investors during European trading.

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AIB added 3 per cent to just under €2.15, while Bank of Ireland closed 1 per cent higher at €5.60. Index heavyweight Ryanair nudged up 0.9 per cent to €12.26, while packaging group Smurfit Kappa rose 0.8 per cent to €32.69. It was also a good day for Dalata Hotel Group, which finished up 4.2 per cent at €3.59.

Building materials group CRH ended the day higher too, rising 1 per cent to €3.59, with food company Glanbia among the few fallers in the session, declining 1.9 per cent to €10.78.

London

Britain’s FTSE 100 rose 0.9 per cent on Monday, having risen as much as 1.5 per cent earlier in the session, as the London market was lifted by commodity stocks and an upbeat global mood.

Oil majors Shell and BP rose more than 2 per cent each, as crude prices jumped on a weakening dollar and fears of tight supplies from Russia.

Mining giants Glencore and Rio Tinto rose 2.9 per cent and 3.2 per cent respectively as metal prices rose on Chinese regulators’ measures to avert a potential crisis in the country’s property market and a softer dollar. However, investors remained cautious ahead of earnings this week in Europe amid soaring inflation, slowing economic growth and political uncertainties.

The mid-cap FTSE 250 index climbed 1 per cent.

Drugmaker GSK’s spin-off Haleon fell 6.6 per cent on its London Stock Exchange debut after it started trading at 330 pence, giving it a market valuation of around £31 billion pounds (€36.6bn). Shares of GSK were flat.

Euromoney surged 9.5 per cent after a group led by French investment firm Astorg Asset Management said it would offer to buy the business-to-business information company.

Europe

The pan-European STOXX 600 index, which had risen as much as 1.5 per cent to hit three-week peaks earlier in the session, cut gains to 0.9 per cent after the Gazprom report. Germany’s Dax rose 0.7 per cent, having earlier climbed as much as 1.5 per cent, while the French Cac 40 was up 0.9 per cent.

In Italy, amid political turmoil, stocks advanced 1.1 per cent, while Italy’s 10-year bond yield rose as high as 3.49 per cent, pushing the closely watched spread over German bund yields to its widest level in over a month.

In earnings-driven moves, Finland’s Nordea jumped 6.1 per cent as a rise in earned loan interests boosted second-quarter operating earnings.

New York

Wall Street stocks rose in early trading, buoyed in part by bank stocks which were up 1 per cent, as Goldman Sachs climbed 3.5 per cent on the back of better than expected figures and Bank of America advanced 1.1 per cent after its quarterly results.

Oil prices extended gains, boosted by mounting concerns over gas supply from Russia and a lower dollar, offsetting demand fears brought on by a possible recession and China lockdowns. US crude recently rose 4.09 per cent to $101.58 per barrel and Brent was at $105.53, up 4.32 per cent on the day.

– Additional reporting: Reuters