Global shares crushed by rise in US bond yields amid fears Fed may keep interest rates higher for longer

Global shares fell on Tuesday, crushed by a surge in United States bond yields to their highest level since late 2007, after hotter-than-expected jobs data fanned fears the Federal Reserve may keep interest rates higher for longer.

Dublin

In Dublin, the ISEQ All Share Index fell 0.63 per cent on Tuesday, closing at 8,227.35. The Irish Stock Exchange performed better than European peers but there was still little on the upside for individual stocks.

Renewable energy storage company Corre Energy saw an increase of 1.23 per cent to €3.30, while Paddy Power parent company, Flutter Entertainment, rose 0.52 per cent to €153.65.

There were sector wide losses for banks, as AIB fell 1.46 per cent to €4.056, Bank of Ireland was down 0.79 per cent to €9.056 and Permanent TSB lost 0.95 per cent to close at €2.08.

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Ryanair lost 1.49 per cent, closing at €15.55. It outperformed peers, however, with UK based Wizz Air losing 3.98 per cent and EasyJet down 2.48 per cent.

The Irish airline reported September traffic numbers on Tuesday, noting a 9 per cent increase on last year and projecting passenger numbers to grow by 9 per cent to a record 183.5 million by the end of its fiscal year to March 2024.

The two home builders on the Irish stock market both saw losses, with Glenveagh Properties down 2.75 per cent to €0.955 and Cairn Homes down 0.18 per cent to €1.08.

Building materials group Kingspan also fell, down 1.27 per cent to €68.34, while packaging company Smurfit Kappa closed at €30.73, losing 0.87 per cent.

Other downward movers included Dalata Hotel Group, which lost 2.02 per cent closing at €3.88 and agri-services group Origin Enterprises which fell 2.37 per cent to €3.29.

London

UK stocks fell on Tuesday, weighed down by energy and mining companies as prices of most commodities fell due to a stronger dollar.

Exporter-heavy FTSE 100 Index lost 0.54 per cent on Tuesday, closing at 7,470.16, while the more domestically focused FTSE Mid-Cap 250 fell by 1.67 per cent to 17,677.76.

Bakery chain Greggs slipped 4.12 per cent on Tuesday, even as the food company reported a rise in sales in the third quarter, and maintained its full-year outlook.

Online fashion retailer Boohoo saw shares fall to a more than eight-year low on Tuesday after it warned a slower-than-expected recovery in sales volumes could result in little or no top-line improvement for the full year. While the stock recovered slightly later in the day, it still closed down 2.75 per cent.

Luxury clothing brand Burberry lost 3.43 per cent, after UBS downgraded the retailer to “sell” from “neutral”.

[ Markets wrap: Negative note sounded for Euro stocks as manufacturing levels slide ]

Europe

The pan-European STOXX 600 Index fell 1.1 per cent on Tuesday, to 440.70. The European index touched its weakest level since March, dragged down by rate-sensitive utilities and miners as US treasury yields and the dollar were boosted.

The German DAX Index was down 1.06 per cent closing at 15,085.21, while the French CAC 40 lost 1.01 per cent, to close at 6,997.05.

Shares of offshore wind developer Orsted fell 6.03 per cent to a more than five-year low, while Vestas Wind Systems slid 5.45 per cent.

Shares of German online fashion retailer Zalando dropped 5.32 per cent after Deutsche Bank cut forecast for adjusted earnings before interest and taxes.

New York

US job openings unexpectedly increased in August, according to a report published on Tuesday by the Labor Department, pointing to a still tight labour market that could compel the Federal Reserve to raise interest rates next month.

Financial markets dialled down expectations that central bankers would keep rates unchanged at the next policy meeting and Wall Street’s key indexes dropped on Tuesday as treasury yields rose.

Among individual stocks, Boeing shares rose after reports that United Airlines was set to announce an order for 50 Boeing 787 Dreamliner aircraft, while Airbnb fell after Keybanc downgraded the accommodation platform’s stock to “sector weight”.

Additional reporting from Reuters