Fears over interest rates and growth weigh on consumer stocks

European shares fell on Wednesday after higher-than-expected US inflation this week cemented views of a large interest rate hike by the US Federal Reserve, but a rally in oil stocks kept declines in check.

In New York, US stock indexes rose as investors scooped up beaten-down energy and technology shares following a sharp sell-off in the previous session on the worries over interest rates.

Dublin

The Iseq fell by almost 1.9 per cent, dragged lower by stocks exposed to consumer spending.

Dalata, the country’s biggest hotel group, fell almost 2.4 per cent to close at €3.27. Meanwhile, budget airline Ryanair fell by almost 2.5 per cent to finish the session at €12.18.

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Market heavy hitter, the building materials group CRH, was down by 3.3 per cent to €35.40. The stock is sensitive to worries over the economy in the US.

Homebuilder Glenveagh Properties fell 2.5 per cent to close at €12.27, despite reporting a surge in revenues and profits for the first half of the year.

Tullow Oil, which is due to delist from the Dublin market soon, rose with crude prices and was ahead by almost 5 per cent to 54.1 cents per share.

London

Markets slumped again as traders continue to fret about a global recession and a concerning inflation outlook.

Homeware retailer Dunelm closed higher after it reported that annual profits leapt nearly a third higher to a new record. Shares increased by 25p to 748p despite the company highlighting an “extremely challenging” wider economic backdrop.

Naked Wines suffered a headache after the online retailer warned it is reviewing its plans for the next 18 months and saw a director leave after three weeks in the job. It slid by 54.7p to 90.4p at the end of the session.

Luxury car manufacturer Aston Martin declined after reports in the Financial Times that the business is facing a £150 million lawsuit from two former car dealers. Shares fell by 3.55p to 153.7p after Nebula Project, a firm run by Andreas Baenziger and Florian Kamelger, reportedly filed a case against Aston Martin.

Europe

The continent-wide Stoxx 600 index extended declines, falling 0.9 per cent, with miners, industrials and consumer stocks weighing the most. Energy stocks gained 0.8 per cent as oil prices rose after the International Energy Agency said it expects an increase in gas-to-oil switching due to high prices this winter.

The German Dax declined 1.17 per cent by the end of the session and the French Cac finished 0.42 per cent lower.

Retailers jumped 0.8 per cent led by Inditex, the Spanish owner of fashion brand Zara, which surged 3.8 per cent after reporting a 24.5 per cent jump in six-month sales and a higher profit than a year ago.

Spanish power company Iberdrola fell 1.9 per cent as it agreed to sell a 49 per cent stake in a German offshore wind farm for €700 million.

German forklift truck maker Kion tumbled 29.7 per cent to nine-year lows on a profit warning as the company struggled with supply chain issues and higher costs.

New York

Five of the 11 major S&P sectors were higher, led by a 3.2 per cent jump in the energy sector as oil prices rebounded nearly 2 per cent on supply concerns.

Shares of technology and growth companies such as Amazon, Tesla and Apple gained between 0.9 per cent and 1.3 per cent after leading declines on Tuesday.

Focus was also on talks in Washington with freight railroad and union officials aimed at heading off a rail shutdown looming as early as Friday that could disrupt cargo shipments, impede food and fuel supplies and add to inflation woes. Shares of US railroad operators Norfolk Southern, CSX and Union Pacific were down between 2.6 per cent and 4.9 per cent.

Starbucks jumped 6 per cent after the coffee chain lifted its three-year profit and sales outlook. — Additional reporting: Reuters/PA