Business

European markets dip from historic highs

US stocks maintain momentum as Dow Jones breaches 40,000 mark

EasyJet shares hit turbulence on the London stock exchange on Thursday. Photograph: Fabrice Coffrini/AFP.

Barry O'Halloran
Thu May 16 2024 - 18:42

European shares dipped from record highs on Thursday as results and other factors swayed investors who have been betting heavily on interest rate cuts in recent days.

Dublin

The Iseq index ticked up on a day marked by moves in several stocks. PTSB climbed 5.33 per cent to €1.58 after the sale of a block took pressure off the lender’s shares, dealers said.

A similar move on housebuilder Glenveagh sent that stock up 4.12 per cent to €1.364.

Ingredients and convenience foods group Kerry gained 1 per cent to close at €79.05. Traders noted that the stock had been sold heavily in recent days.

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Ryanair dipped 0.88 per cent to €18.57. Dealers said investors were likely to focus on Europe’s biggest airline as it prepared to publish full financial year results on Monday amid mixed sentiment towards its industry.

Origin Enterprises fell 4.63 per cent to €2.99. Dealers noted that the stock was due to be excluded from the MSCI small cap index this month.

London

EasyJet shares endured some turbulence, falling 6 per cent to 497.7 pence sterling as the company announced quarterly results and chief executive Johan Lundgren revealed he would step down in 2025.

Traders said investors interpreted comments that the airline expects yields in the summer to be “slightly up” on last year as indicating that air fares would be weaker than previously expected.

Chief financial officer Kenton Jarvis will replace Mr Lundgren.

Miner Rio Tinto hit a rich seam, climbing 2.3 per cent to 5,649p, aided by strong commodities demand.

BT shares surged 17.2 per cent to 132.6p after the telecom group announced plans to cut costs by £3 billion.

Europe

European markets slipped on Thursday, weighed down by German engineering giant Siemens after a second-quarter industrial profit miss.

Siemens was down 6.8 per cent at €175, the biggest drag on the Stoxx 600, as second-quarter industrial profit fell 2 per cent and missed estimates after a slowdown at its flagship factory automation division.

Automobile was the worst-hit sector, down 1 per cent in morning trade. Bit players including Bayerische Motoren Werke (BMW) and Daimler Truck shed value as they traded ex-dividend.

Belgian materials technology and recycling group Umicore lost 4.5 per cent to €20.02 after naming Bart Sap as chief executive officer in a surprise move.

Swedish engineering and architecture consultancy firm Sweco soared 15 per cent to 139.8 kroner after first-quarter core earnings beat expectations.

US

The Dow crossed the 40,000 level for the first time on Thursday, notching a fresh all-time high and leading Wall Street gains a day after tepid inflation data bolstered hopes of interest-rate cuts.

The blue-chip index has recovered nearly 40 per cent from its October 2022 lows, powered by strong quarterly results and rising bets of interest rate cuts by the Federal Reserve, the US central bank.

All three major indexes notched record closes in the previous session after a smaller-than-expected rise in consumer inflation fuelled optimism that inflation was easing after three months of hotter numbers.

Walmart rose 5.8 per cent after the retail giant raised its fiscal 2025 sales and profit forecast, betting on easing inflation to further boost demand for essentials.

That helped consumer staples lead sectoral advances with a 1.6 per cent gain.

Deere fell 3.2 per cent after the farm equipment maker trimmed its annual profit forecast for the second time.

US-listed shares of Chubb added 3.6 per cent after Warren Buffett’s Berkshire Hathaway revealed a stake worth $6.7 billion in the insurer. Additional reporting – Reuters

Barry O'Halloran

Barry O'Halloran

Barry O’Halloran covers energy, construction, insolvency, and gaming and betting, among other areas

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