Business

European markets make gains after worst fall in a year

Dublin’s Iseq finished up 2.25% while FTSE rebounds

Stoxx 600 finished up 1.29 per cent on Friday. Stock photograph
Stoxx 600 finished up 1.29 per cent on Friday. Stock photograph
Fiona Keeley
Fri Nov 01 2024 - 18:33

Dublin’s Iseq finished up 2.25 per cent on Friday, outperforming European peers. It comes as stocks on the FTSE rebounded from the near three-month lows seen in the earlier trading session. European stocks gained, snapping three straight days of declines after they posted the worst monthly drop in a year on Thursday.

Dublin

In banking, AIB was up 5.03 per cent finishing at €5.14, while Bank of Ireland was up 3.4 per cent to €8.75. Food group Glanbia rose 2.03 per cent to €15.56 and Kerry Group was up 3.06 per cent to €94.30.

Ryanair finished Friday up 2.42 per cent at €18.02. Dalata Hotels rose 1.40 per cent to €4.34 a share. Kingspan dropped by 0.62 per cent to €80.15. For housebuilders, Cairn Homes rose 1.41 per cent to €2.16 and Glenveagh was up 0.88 per cent to €1.61.

London

The UK’s FTSE 100 rebounded on Friday from near three-month lows touched in the prior session, as gains in Reckitt Benckiser helped offset concerns about inflation sparked by the first Labour government budget in 14 years.

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The blue-chip FTSE 100 rose 0.8 per cent, with Reckitt surging 7.4 per cent after the consumer goods company, along with US-based Abbott Labs, was cleared of liability in a preterm formula case.

The midcap FTSE 250 index edged up 0.5 per cent but hovered near a three-month trough touched on Thursday as Britain’s finance minister Rachel Reeves faced criticism after her first budget was heavy on spending, tax increases, and borrowing but light on economic growth.

The indexes logged weekly declines after the budget raised concerns about inflation pressures building again, prompting traders to scale back expectations of rate cuts from the Bank of England.

Investors stuck to bets that the Bank of England will cut rates by 0.25 per cent next week, but reduced the chance of a December cut to less than 50 per cent. They also expect fewer rate cuts next year.

Data showed British factory activity contracted marginally last month for the first time since April, due to fewer new orders and a broader lack of optimism in the run-up to the budget.

Among other stocks, Tesco rose 1.7 per cent after Britain’s biggest supermarket group said that it intended to return £700 million (€835 million) to shareholders through an incremental share buyback.

Europe

The Stoxx 600 finished up 1.29 per cent on Friday. The Cac 40 ended 0.8 per cent higher for the day and the Dax index was up 0.92 per cent. Euronext 100 finished up 0.98 per cent on Friday.

It comes as European stocks are on track to post their biggest monthly decline since October 2023 on concerns about stunted economic growth at home as well as weak demand and trade spats with key partner China. Data on Thursday showed euro area inflation accelerated more than expected this month.

New York

Wall Street’s main indexes surged on Friday, rebounding from the previous session’s sell-off as Amazon’s strong earnings countered Apple’s weaker China sales as well as a significant drop in US jobs growth in October.

Amazon.com soared nearly 7 per cent, on track for its best day since February, as strong retail sales lifted its profit above Wall Street estimates.

Meanwhile, Apple dropped 1.8 per cent, the only so-called Magnificent Seven member in the red, as investors worried about a decline in its China sales.

Cost warnings on AI-related infrastructure from Meta Platforms and Microsoft saw the Nasdaq log its worst day in nearly two months on Thursday.

“When you look at expectations for the Magnificent Seven megacaps, there’s been an expectation that the tree was going to grow to the sky – so far, earnings have been a mixed bag and when you look at valuations, there is some room to pull back,” said Brad McMillan, chief investment officer at Commonwealth.

Equity markets broadly overlooked weak US October nonfarm payrolls data, given disruptions from hurricanes and strikes. The data showed an increase of 12,000 jobs, much smaller than economists’ estimate of a 113,000 rise.

However, the unemployment rate held steady at 4.1 per cent, reassuring investors the labour market remained on solid ground in advance of the US presidential election. Additional reporting: Agencies

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