Global shares advance as investors eye US inflation update and ECB meeting

European and US shares advanced on Monday, as investors absorbed signs of economic stabilisation from China and looked ahead to hotly anticipated US inflation data and a European Central Bank policy meeting later this week.

Dublin

Trading in the Irish market reflected similarly small rises across Europe on Monday, as the Iseq All Share Index rose by 0.33 per cent, closing at 8,655.81.

Insulation and construction products company Kingspan dropped 0.46 per cent to €73.30, following weekend reports that the company informally approached US firm Carlisle with a merger offer.

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While Arizona-based Carlisle reportedly rebuffed the proposal, share trading volumes spiked as Irish investors reacted to the news.

Another Iseq heavyweight coming off the back of major merger news, packaging company Smurfit Kappa, saw a rise of 2.75 per cent to €35.84, recovering slightly from losses late last week.

The Dublin-based group confirmed last week that it is in discussions for a potential multibillion-euro merger with Atlanta-based contemporary WestRock, amid a general post-pandemic downturn in the packaging sector.

There was slight upward movement among the banks, with Bank of Ireland outperforming its peers, rising 1.36 per cent to €8.93. AIB saw an increase of 0.35 per cent to €3.97, while Permanent TSB rose by 0.99 per cent to €2.05.

Home builder Cairn Homes saw an increase of 1.24 per cent to €1.14, while peer Glenveagh Properties fell 0.80 per cent to €0.99, and Irish Residential Properties rose 2.77 per cent to €1.00.

Paddy Power parent company Flutter saw a decline of 0.30 per cent, to €165.70, while Ryanair shares rose by 0.22 per cent to €15.86.

Nutrition group Glanbia fell 0.76 per cent to €15.70, while dairy company Kerry Group rose 1.12 per cent to €84.96.

London

The FTSE 100 Index in London edged up 0.25 per cent on Monday, to 7,496.87. Meanwhile, the more domestically focused FTSE 250 Mid-Cap Index closed up 0.32 per cent, at 18,522.44.

British home builder Vistry Group led the gains among FTSE 250 stocks, jumping 12.56 per cent after the group said it would merge its affordable-housing business “partnerships” with its housebuilding operations.

Fresnillo, the world’s largest silver producer, was the biggest upward mover on the FTSE 100, gaining 4.62 per cent, followed by mining companies Rio Tinto and Antofagasta, which rose by 3.44 per cent and 2.93 per cent respectively.

The gains reflect a wider uptick in the mining sector, as prices of metals rose on prospects of better demand from top consumer China.

Europe

The pan-European Stoxx 600 Index saw gains of 0.38 per cent by Monday evening, as investors looked towards a meeting of European central bankers on Thursday to cement bets on the ECB’s interest rate trajectory.

Money market participants see a 60 per cent chance that the ECB will keep its interest rates steady on Thursday, according to data from the London Stock Exchange Group.

Monday’s gains come after the Stoxx 600 index shed nearly 1 per cent last week, amid worries about higher-for-longer US interest rates.

New York

Wall Street also advanced modestly on Monday, the calm before the storm as investors await a crucial consumer prices report due in the coming days.

All three major US stock indexes were higher in early trading, rebounding from the prior week’s net losses, with electric automaker Tesla Inc providing the most upside lift.

Tesla share values spiked on Monday as Morgan Stanley upgraded it to “overweight” from “equal-weight”, saying the EV maker’s Dojo supercomputer could boost the company’s market value by nearly $600 billion (€558 billion).

Shares of other megacaps including Apple, Microsoft and Amazon also rose on Monday.

All eyes now turn to CPI data due on Wednesday, which will give a snapshot of August inflation and could provide some clarity on how long the restrictive policies of the US Federal Reserve are likely to last. – Additional reporting: Reuters