Business

Global markets subdued as investors await interest rate announcements

In Dublin, shares were down on the day, in line with European peers

Traders work on the floor of the New York Stock Exchange. Investors are awaiting interest rate decisions this week from the European Central Bank, the UK and the US. Photograph: Michael Nagle/Bloomberg

Ellen O’Regan
Tue Dec 12 2023 - 20:04

Global markets were generally subdued on Tuesday, as investors await interest rate announcements from the Federal Reserve, the Bank of England and the European Central Bank this week. All three are expected to hold rates steady.

Dublin

Euronext Dublin was down on Tuesday, as the Iseq All Share fell by 0.44 per cent to close at 8,481.85.

It was a mixed day for the Irish banks, as AIB fell by 2.46 per cent to close at €3.81, while Bank of Ireland gained 0.34 per cent to €8.19. Permanent TSB closed at €1.58, after falling by 1.25 per cent on a day when it announced new appointments to its board.

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Among other stocks, Ireland’s two listed home builders both fell. Cairn Homes lost 3.37 per cent to close at €1.26, while Glenveagh Properties fell by 1.21 per cent to €1.15.

Meanwhile, building materials company Kingspan lost 0.53 per cent, to close at €74.82.

Food company Kerry Group lost 0.59 per cent on Tuesday to close at €73.72, having announced a €150 million acquisition. Glanbia rose by 0.95 per cent to €15.92.

Paddy Power parent company Flutter Entertainment fell by just under 1 per cent on the day, to close at €152.65, while fellow Iseq heavy hitter, packaging giant Smurfit Kappa, lost 1.27 per cent to close at €35.09.

Among the few stocks on the Irish market that saw gains on the day was Ryanair, which rose by 1.45 per cent to close at €18.54. Also on the up, Dalata Hotel Group gained 0.70 per cent to close at €4.30.

London

In London, trading was flat by closing on Tuesday, as official data showed British wage growth slowed more than expected in the three months to the end of October, but pay is probably still increasing too quickly to persuade the Bank of England to cut interest rates any time soon.

The exporter-heavy FTSE 100 Index fell by 0.03 per cent to close at 7,542.77, while the more domestically-focused FTSE Mid-Cap 250 Index fell by 0.47 per cent to 18,662.12.

Aerospace and defence stocks hit a record high, led by a 2.63 per cent rise in shares of Rolls-Royce after ratings agency Fitch upgraded its credit rating to BB+.

Telecoms firm BT Group lost 3.92 per cent after UK’s Ofcom proposed a ban on inflation-linked mid-contract price rises.

Hargreaves Lansdown fell 6.67 per cent to the bottom of the FTSE 100 index after a market watchdog flagged concerns about the interest and fees charged by some investment platforms.

AstraZeneca rose 0.75 per cent after it agreed to buy respiratory syncytial virus (RSV) vaccine developer Icosavax in a deal valued at up to $1.1 billion (€1.02 billion).

Europe

European markets reversed early gains on Tuesday after briefly touching record highs, as investors digested US data that showed consumer prices unexpectedly rose last month.

The pan-European Stoxx 600 Index was down on Tuesday, falling by 0.21 per cent, while the French CAC 40 index hit record highs early in the day before losing 0.11 per cent by close, and the German Dax was down 0.02 per cent after also touching record highs during the day.

German meal-kit company Hello Fresh fell by 5.51 per cent, while reaching the bottom of the Stoxx 600 was German energy company Uniper, which lost 8.18 per cent.

Carl Zeiss Meditec jumped 6.53 per cent following the German medical technology group’s higher annual revenue and a more optimistic outlook.

New York

Wall Street’s main indexes edged higher on Tuesday, as investors absorbed latest inflation data and awaited the Federal Reserve’s policy decision later in the week.

The US consumer price index (CPI) for November rose 3.1 per cent on an annual basis, in line with estimates, while on a month-on-month basis, consumer prices unexpectedly rose 0.1 per cent.

Oracle fell as the cloud services provider forecast third-quarter revenue below estimates on slowing demand for its cloud service.

Google-parent Alphabet also saw losses, after Fortnite maker Epic Games prevailed in its high-profile antitrust trial over the company.

Among other movers, Lucid was down after the electric-vehicle maker’s chief financial officer Sherry House stepped down.

Airbnb fell as Barclays downgraded the rental firm’s shares to “underweight” from “equal weight”. – Additional reporting: Reuters

Ellen O'Regan

Ellen O’Regan

Ellen O’Regan is an Irish Times journalist.

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