Global stocks dipped on Tuesday after five straight sessions of gains while the dollar touched its highest level in more than four months as investors gauged the impact of US president-elect Donald Trump’s likely policies on growth and inflation.
Investors have been pouring cash into assets believed to benefit from Trump policies for his second term in office, in which he has pledged to impose high tariffs on imports from key trading partners, as well lower taxes and loosen government regulations. The S&P 500 has surged to record highs, in part due to a jump in shares of banks, which are likely to benefit from a reduced regulatory burden.
Bitcoin, the world’s biggest cryptocurrency, has surged about 30 per cent since the November 5th election as it rockets toward the $90,000 mark. Mr Trump is seen as a proponent of cryptocurrencies.
US stocks have rallied since the election, with each of Wall Street’s three major indexes closing at record levels on Monday.
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DUBLIN
Kerry Group was the market springer in Dublin, rising 4 per cent to €91.30 after the company announced it had agreed to sell its dairy processing division in two stages to its main shareholder, Kerry Co-op, in a deal worth €500 million.
The publicly-quoted food giant confirmed on Tuesday morning that the co-op will initially take a 70 per cent stake in the business, known as Kerry Dairy Ireland, for about €350 million.
The deal covers milk processing plants in the Republic and the UK and well-known brands such as Dairygold spreads, Charleville cheese and Cheestrings snacks. The business has 1,500 employees and will continue to supply Kerry Group.
In tandem with souring sentiment across Europe about a hawkish Trump presidency in the US, AIB and Bank of Ireland both fell by 2 per cent respectively. Ryanair also dragged the index lower falling by 2 per cent to €18.67.
LONDON
London’s top stock index slid to its lowest closing price for three months on Tuesday amid a global sell-off, while the pound slumped after a drop in wage growth.
Top commodity stocks in the City had a particularly poor session, with Anglo American, Glencore and Antofagasta all lower on the back of waning metal prices. Vodafone and Shell were also notable drags on the FTSE 100.
The index finished 99 points, or 1.22 per cent, lower to end the day at 8,025.77.
“The stock market rally is on pause on Tuesday,” said Kathleen Brooks, research director at XTB. “There have been some chunky losses for European stocks, and even US stocks have seen their gains slow.”
Dublin-based conglomerate DCC however had a strong session after the firm told investors it is plotting to break up the group to focus solely on its energy division.
The company said it was preparing to sell its healthcare arm and was reviewing options for its technology business as part of its latest strategy. DCC shares were up 14.2 per cent at 5,670p.
EUROPE
In Europe, shares were lower, weighed down by names with a large exposure to China, as Trump was expected to select US Senator Marco Rubio as his secretary of state. Rubio is seen as the most hawkish option on Trump’s list.
The Cac 40 ended 2.69 per cent lower for the day and the Dax index was down 2.06 per cent. MSCI’s gauge of stocks across the globe fell 4.00 points, or 0.46 per cent, to 859.10. The Stoxx 600 index fell 1.53 per cent, while Europe’s broad FTSE EuroFirst 300 index fell 30.79 points or 1.52 per cent as both were on track for their biggest daily percentage drops since August.
NEW YORK
Wall Street’s main indexes fell on Tuesday as investors booked profits following post-election gains over the past few days, while focus moved to key inflation data later in the week.
Some of the stocks expected to perform well under Donald Trump’s presidency gave back gains. EV maker Tesla, which has soared nearly 40 per cent since November 5th, fell 3.4 per cent.
The consumer discretionary, materials and utilities sectors fell more than 1 per cent each.
The small-cap Russell 2000 fell 1.3 per cent after the index closed at a three-year high on Monday. Trump Media & Technology Group’s shares were down 8.3 per cent.
Additional reporting by Reuters
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