Stocks rise on US inflation data and China relaxation

European stocks extended gains into a second session, boosted by China’s decision to relax travel curbs and US inflation data that reinforced bets on a Federal Reserve interest-rate pause next month.

DUBLIN

Clawing back slightly less than half of Wednesday’s 1.3 per cent drop, the Iseq index gained 0.6 per cent on Thursday.

Paddy Power owner Flutter topped the table, improving 2.8 per cent to €170.45 per share. Shares in the gaming giant had sunk over two sessions after it posted a substantial increase in quarterly earnings earlier this week but warned of a weaker outlook in its Australian market.

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Ryanair, meanwhile, added 1.4 per cent to close at €15.94 per share in line with a general lift in travel and tourism stocks across Europe after China’s travel restriction relaxation.

Irish bank stocks were a mixed bag. AIB was the only gainer on the session, adding 0.9 per cent to finish the day at €4.35 per share. Bank of Ireland was essentially flat at €9.60 per share while Permanent TSB fell to €2.14 per a share, a slide of 3.2 per cent.

Insurer FBD sank 1.5 per cent to close at €12.75 in advance of its interim results release on Friday.

EUROPE

The blue-chip Stoxx 50 advanced more than 1.4 per cent while the pan-European Stoxx 600 index was ahead by 0.75 per cent after China’s announcement that it would lift a ban on group travel to several countries, including the US and UK.

The news lifted luxury stables like Gucci owner Kering, Hermés and Luis Vuitton parent LVMH, which were all ahead by 2.6 per cent and 3.5 per cent.

The relaxation, which could offer a significant boost to the global tourism market, sent Europe’s travel and leisure subindex more than 1 per cent higher. Insurance shares and real estate stocks outperformed, while declines were led by basic resources stocks.

Shares in German engineering giant Siemens slipped another 4 per cent after missing profits forecasts in its latest quarter.

LONDON

The UK’s benchmark FTSE 100 index rose 0.8 per cent while the mid-cap FTSE 250 advanced by 0.3 per cent.

Banks stocks were mixed with Barclays, HSBC and NatWest off by between 0.6 per cent and 1.2 per cent as they traded ex-dividend while Standard Chartered and Lloyds gained ground.

Mining stocks fell 0.4 per cent, leading sectoral losses as Rio Tinto’s more-than-2.5 per cent drop weighed. A 1.3 per cent rise in shares of Antofagasta, coming after the Chilean miner raised shareholder returns, capped falls.

Moving up the table, Burberry was the best performer on the day, adding 2.7 per cent on the China reopening announcement. Housebuilder Persimmon, meanwhile, was ahead by 2.3 per cent despite reporting a 65 per cent plunge in half-year profits.

NEW YORK

All the major Wall Street indexes were on track to advance on Thursday after the release of fresh US data showed a moderate rise in July consumer price inflation, bolstering the view that the Federal Reserve is at the end of its rate hiking cycle. By the closing bell in Dublin, the S&P 500, the tech-heavy Nasdaq Composite and the Dow Jones Industrial were all ahead by close 0.7 per cent.

The consumer price index (CPI) gained 0.2 per cent last month, the US department of labour said, lifting the annualised rate to 3.2 per cent from 3 per cent in June. Economists polled by Reuters expected headline CPI to rise to 3.3 per cent.

Consumer price increases have decelerated from a peak of 9.1 per cent in June 2022 and are now close to the Fed’s inflation target of 2 per cent.

Amazon, Microsoft and Apple all added between 0.9 per cent and 1.3 per cent. On the earnings front, Walt Disney rose 1 per cent after beating Wall Street estimates for quarterly adjusted profit per share.

Capri surged 56.8 per cent after larger rival Tapestry said it would buy the Michael Kors parent in an $8.5 billion (€7.7 billion) deal. Tapestry’s shares fell 9.1 per cent.

US-listed shares of Alibaba added 5.5 per cent after the ecommerce conglomerate reported upbeat quarterly sales on the back of improved consumer sentiment. – Additional reporting: Bloomberg, Reuters