European values advance on back of positive US data over global slowdown

European shares moved higher as better than expected US data helped calm jitters over a global economic slowdown and over hawkish signals from world bank leaders.

But with the strong employment figures also fuelling bets that the Federal Reserve will need to raise interest rates twice more this year, US Treasury yields jumped in a mixed session for Wall Street stocks.

DUBLIN

Following up Wednesday’s 1.2 per cent gain, the Iseq index moved a meagre 0.1 per cent higher, broadly in line with its continental peers.

Irish banks led the index as traders ramped up bets that more European Central Bank rates hikes are on the way after comments from governing council member Boris Vujcic. Speaking at the central bank’s annual conference in Sintra, Portugal, Mr Vujcic told Bloomberg TV that stubborn consumer-price gains may prevent officials from being able to pause interest-rate increases after the summer.

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One day after the Government announced a placing of 5 per cent of shares, AIB was up by almost 1.4 per cent to €3.78 per share. Its rival Bank of Ireland, meanwhile, added 2.2 per cent to nearly €8.70 per share while Permanent TSB was up 4.3 per cent to €2.19 per share.

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Moving in the opposite direction, Paddy Power owner Flutter was at €179.75 by closing bell, down 1.6 per cent, while shares in index heavy hitter CRH were flat on the session after Wednesday’s 2.2 per cent gain.

EUROPE

European stocks were slightly ahead on Thursday’s session with the blue-chip Stoxx 50 index adding 0.25 per cent and the pan-Europe Stoxx 600 up by more than 0.1 per cent.

Swedish high street fashion retailer H&M soared more than 18 per cent after its second-quarter profits beat estimates.

Spanish stocks gained after the country became the first in the euro zone to get inflation below the European Central Bank’s 2 per cent target. The economy’s annual rate of inflation hit 1.9 per cent in June, its lowest level since March 2021, although its harmonised 12-month inflation came in at 1.6 per cent, slightly above the 1.5 per cent average expectation from analysts polled by Reuters.

Shares in banks BBVA and Santander moved 1.6 per cent and 1 per cent higher while Zara owner Inditex added 1.4 per cent. Bilbao-anchored energy retailer Iberdrola was also ahead on the session by 0.1 per cent.

Electricity retailer Endesa, down as much as 8.8 per cent at one point, shed more than 1 per cent a week after being named at the centre of a Spanish antitrust probe.

LONDON

British equities slipped on Thursday as investors stayed on the sidelines after top central bankers signalled more interest rate hikes are probably on the cards. The benchmark FTSE 100 fell by almost 0.4 per cent with the mid-cap FTSE 250 off by 0.8 per cent.

Shares of Serco Group jumped 10 per cent after the British outsourcing company raised its full-year profit and revenue outlook.

Burberry Group lost 2.6 per cent, as shares of the luxury brand traded ex-dividend. The broader personal goods sector was down 2.2 per cent.

Discount retailer B&M said its revenue rose 13.5 per cent in its first quarter. Shares, however, slipped 7 per cent as the stock traded ex-dividend.

NEW YORK

Wall Street’s main indices were on track for meagre gains at the closing bell in Dublin. The Dow Jones Industrial Average added almost 0.6 per cent, while the S&P 500 was up by close to 0.3 per cent and the Nasdaq Composite was flat.

Financial companies led gains on Wednesday, as the biggest US lenders passed the Fed’s stress test, clearing the way for payouts. The KBW Bank Index of large institutions like Wells Fargo and JP Morgan Chase climbed about 2 per cent. Goldman Sachs, meanwhile, added more than 3 per cent while Bank of America was up by 2.2 per cent.

After recent AI-driven gains, the megacap tech space had some weakness, with Meta, Microsoft and Google’s parent Alphabet moving lower by less than 1 per cent. — Additional reporting: Bloomberg, Reuters