Anti-euro comments from a senior Italian politician and bubbling concerns about Brexit negotiations combined to send European shares lower on Tuesday.
The pan-European Stoxx 600 index ended the session down 0.5 per cent to its lowest level in two weeks, failing to benefit from a more upbeat mood on Wall Street.
Dublin
The Iseq overall index dropped 0.3 per cent to 6,472.64, its lowest level since March.
Fuel forecourt retailer Applegreen dropped 3.9 per cent to €6.50, as it handed back some of its strong gains over the pervious two sessions.
Aryzta was also on offer, declining 4.3 per cent to €2.42, having surged strongly on Monday as investors cheered the fact that the baked goods group managed – for a change – to publish a set of financial results without issuing unexpected bad news.
Ryanair lost 1.2 per cent to €11.34, continuing Monday's decline, after the airline issued a profit warning.
Bucking the trend, FBD advanced 1.9 per cent to €10.75 as it sold bonds to help refinance a €70 million convertible bond that had been bought by Canadian group Fairfax in the Irish company three years ago.
Banking stocks were also in demand, as they recovered from a broad-based sell-off last week.
London
British shares retreated as the positive impact of a new North American free trade pact faded globally and shares of Royal Mail hit a record low the day after the 500-year-old postal service issued a profit warning.
The top FTSE 100 index fell 0.3 per cent to 7,474.55 points.
The exporter-heavy index did not enjoy the usual accounting boost from the pound falling to a three-week low, with investors anxious about infighting in the ruling Conservative party over prime minister Theresa May’s Brexit plan.
The biggest weight was Royal Mail, which lost 8.4 per cent. Shares of the company, founded under Henry VIII, plunged 18 per cent on Monday after it warned its shareholders annual profits would be far lower than expected, hurt by eroding logistics, business margins and weaker letter volumes.
Ferguson was another big loser, tumbling 6.8 per cent after the distributor of plumbing and heating products said organic revenue growth in September fell and warned of challenging UK markets.
Miners were the top boost to the index with Randgold Resources, Evraz, and BHP Billiton up 1.7 to 1.8 per cent as zinc hit its highest in nearly two months on falling stockpiles and rising Chinese premiums.
Europe
The market interest rate, or yield, on Italy's 10-year bonds soared to 4½-year highs after Claudio Borghi, the economic head of the ruling League party, said most of the country's problems would be solved by ditching the euro, before reassuring comments from the government brought calm to a nervous market.
Italian banks, whose large government bond holdings make them sensitive to political stress, fell as much as 4 per cent but limited losses to 1.2 per cent at the close.
Among European heavyweight companies, Philips dropped 3.6 per cent after a Credit Suisse downgrade while Siemens fell 2.6 per cent after a downgrade from HSBC.
New York
US stocks shrugged off a weak start to climb higher in early afternoon trade, as Intel boosted technology stocks and pushed the Dow Jones Industrial Average to a record high.
The Dow Jones was up 0.5 per cent, at 26,780.56, easing after hitting a record high of 26,793.35. The S&P 500 was up 0.2 per cent, while the Nasdaq was little changed.
Intel jumped 5.1 per cent, but analysts could not find a new trigger. Some suggested the stock was reviving Friday’s rally after the chip maker assuaged concerns over its business.
The laggards included Facebook, which declined for the third session in a row amid continuing calls to use legislation to force technology firms take responsibilities for online security seriously.
PepsiCo dipped as disappointing margins due to higher commodity and transport costs overshadowed a quarterly profit that beat estimates. – Additional reporting, Bloomberg, Reuters
