European shares slipped on Wednesday as investors increasingly focused on French elections at the weekend.
The pan-European Stoxx 600 index reversed early gains to close nearly 0.6 per cent lower, pressured by a rise in bond market interest rates — or yields — across the euro zone.
Reports showing a rise in inflation in Australia and Canada have added to market jitters that interest rates will stay elevated for longer than expected.
“The bond market is causing risk sentiment to fade as inflation concerns rise once more,” said Kathleen Brooks, research director at XTB.
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“Australia now has the highest rate of inflation in the developed world and the markets are fearful that this is a sign that inflation could rise once more and derail interest rate cut hopes.”
DUBLIN
The Iseq All-Share index dipped 0.8 per cent to 9,441.28. Rate-sensitive property shares were out of sorts, with Glenveagh Properties dipping 0.8 per cent to €1.30 and Cairn Homes falling 0.3 per cent to €1.61.
AIB ended the session flat at €5.04, just before the Government announced that it was proceeding with a further 5 per cent stake sale. That would bring its holding down to 25.5 per cent. Bank of Ireland advanced 0.9 per cent to €9.94.
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Food stocks were also mixed, with Kerry Group advancing 1.6 per cent to €77.10, while Glanbia dipped 2.4 per cent to €18.23.
LONDON
London stocks closed lower for the third straight session, mirroring European bourses, while energy shares weighed the most and investors were on edge in advance of the Federal Reserve’s key inflation gauge set for release on Friday.
The blue-chip FTSE 100 edged 0.3 per cent lower while the mid-cap FTSE 250 also slipped 0.3 per cent.
The pound dipped 0.5 per cent against the dollar, as investors funnelled funds into the greenback amid growing caution in advance of Friday’s release of the personal consumption expenditures price index.
In the UK, investors will watch out for UK gross domestic product (GDP) on Friday for further clues on the direction of interest rates in Britain.
Moreover, Britain’s general election, scheduled for July 4th, is adding to the caution, with investors expecting political uncertainty to affect markets.
Precious and industrial metal miners were among the biggest gainers among FTSE 350 sub-sectors.
Future gained 8.3 per cent after Jefferies upgraded shares in the publishing house to buy from underperform and hiked its price target.
Shares of UK-based Deliveroo rose 1.2 per cent following a Reuters report that US meal delivery group Doordash had flagged an interest in a takeover of the company last month.
EUROPE
Auto stocks lost 1.3 per cent, with Europe’s largest carmaker Volkswagen slipping 1.6 per cent after the company said it would invest up to $5 billion (€4.68 billion) as part of a joint venture with electric vehicle maker Rivian.
The focus remained on a US personal consumption expenditures reading due on Friday, which could play a key role in gauging the Federal Reserve’s interest rate outlook.
Inflation data from France, Spain and Italy are also due this week. Also on tap is the first round of France’s snap parliamentary election on June 30th. France’s benchmark CAC 40 ended 0.7 per cent lower.
Among other stocks, Alfen clocked its worst day ever, plunging 46.7 per cent after the Dutch energy storage specialist and EV infrastructure provider issued a profit warning.
NEW YORK
Wall Street’s main indexes were flat in mid-afternoon trading, with technology stocks attempting to find a floor after a recent sell-off, while investors awaited a crucial inflation report this week to gauge the path of monetary policy.
Chip leader Nvidia reversed early gains to fall with its losses weighing on the broader Philadelphia SE Semiconductor index.
Apple rose after Rosenblatt upgraded the iPhone maker’s stock to buy from neutral, while Tesla jumped to a nearly two-month high.
Meanwhile, Amazon shares leapt, bringing the company’s market value above $2 trillion, the fifth US corporation to cross that level.
Appliances manufacturer Whirlpool surged after Reuters reported that German engineering group Robert Bosch is weighing a bid for the US appliances maker.
— Additional reporting: Reuters
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