European shares ease as rebound runs out of steam

European shares eased on Monday as last week's rebound ran out of steam on investor nervousness over fast-rising US interest rates and Washington's trade dispute with Beijing.

While most European indices were neutral on the day, Ireland’s Iseq overall index fell 0.43 per cent.

In the United States, the S&P 500 and the Dow Jones Industrial Average rose on Monday, supported by gains in energy stocks and strong results from Berkshire Hathaway. The Nasdaq was dragged down by a drop in Apple shares.

Dublin

The Iseq overall index dipped 0.43 per cent on Monday with Total Produce and Bank of Ireland among the losers.

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Despite it being a generally quiet day in volume terms, the banks were relatively well traded. AIB advanced 0.92 per cent to €4.07 after positive results in European bank stress tests announced after the close of trading on Friday. Bank of Ireland, which wasn't as strong as AIB, dropped 1.2 per cent to €6.16.

Dalata Hotel Group advanced 1.57 per cent on the day after a story in The Irish Times revealed the company had agreed more debt funding with its banks. The stock closed at €5.82.

Glanbia was the big winner on the day and closed up 2.77 per cent to €14.80, albeit on low volume.

London

The FTSE 100 closed up 0.1 per cent, extending last week’s gains as the market continued a cautious recovery from October’s brutal sell-off.

Russian steelmaker Evraz was the biggest FTSE 100 gainer, up 4 per cent, after rebar steel prices in China, the world's top consumer and producer, recovered from three-week lows on hopes Beijing's efforts to shore up the world's second-largest economy will boost demand.

Micro Focus, up 2 per cent, was also among the biggest blue chip gainers after forecasting full-year revenue will be better than initially expected and the company announced plans to renew its share buyback programme. The stock has lost more than half of its value this year after a series of weak trading updates.

Industrial equipment rental firm Ashtead dropped 4.4 per cent as Barclays cut its price target, following a similar move by HSBC last week.

Europe

The pan-European STOXX 600 benchmark index fell 0.1 per cent with most country indexes also hovering around neutral.

Results from the European banking stress tests had little impact, with the sector ending down 0.4 per cent. Britain's Barclays and France's Societe Generale were among unexpected laggards in the health check but their shares were muted, ending down 0.5 per cent and up 0.3 per cent respectively.

The Italian banking index lost 1.6 per cent, however, after Goldman Sachs downgraded BPER and Intesa Sanpaolo to "sell". Their shares fell 3.4 per cent and 1.5 per cent respectively.

Lloyd's of London underwriter Hiscox fell 5.7 per cent after warning that growth could moderate over the rest of the year. Telenet lost 5.4 per cent after a rating downgrade from Bank of America Merrill Lynch.

The top faller on the STOXX 600 was Grenke, which dropped 9 per cent after the company said it may not be able to sustain growth rates in its core leasing business.

New York

Apple's shares were on track for their worst two-day decline since January 2013, after the Nikkei reported that the company had told smartphone assemblers to halt plans for additional production lines dedicated to the iPhone XR.

The energy sector, which has lagged the broader S&P 500 this year, was up 1.4 per cent as the United States imposed a range of punitive sanctions on Iran, lifting oil prices by about 1 per cent.

Chevron rose 3.8 per cent, providing the biggest boost to the Dow, while EQT Corp and Cabot Oil were the top gainers on the S&P 500, rising 6.5 per cent and 4.9 per cent, respectively.

– Additional reporting: Reuters