Theresa May’s call for snap UK election shakes markets

Shares fell as a snap general election call in Britain added to a growing list of uncertainties for investors already on edge over tensions simmering from North Korea to France.

DUBLIN

The Iseq overall index closed the day down by 0.06 per cent. This decline was marginal compared to the FTSE 100, Daz and Cac which all closed down more than 1 per cent.

The biggest gainer on Ireland's overall index was Hostelworld, which traded up by 14 per cent at €3.73 after it emerged that a large buyer purchased a significant number of shares in the company.

Companies with FTSE listings took a hit from the election news in the UK. CRH fell by 1.55 per cent to €31.28 while Smurfit Kappa dropped by 0.84 per cent.

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Despite some airlines struggling, Ryanair remained resilient and had a decent rally, ending the day up by 1.06 per cent at €15.29. The company's peers, Lufthansa and IAG, ended the day down by 0.85 and 2.13 per cent respectively.

Providence Resources was one of the big losers on the Iseq overall index, down by 6.67 per cent, though it closed higher in London.

LONDON

British shares suffered their worst day's drop since the aftermath of last June's Brexit referendum, after UK prime minister Theresa May said she would call an early election.

The FTSE 100 dropped to its lowest in nearly 10 weeks as sterling inched higher, further weighing on the index’s stocks, most of which earn in foreign currencies. The FTSE banking index hit its lowest level in more than four months, down 2.2 per cent on the day.

FTSE volatility rose to its highest since early December, though it stayed near historically low levels.

Mining companies Anglo American, Glencore, Antofagasta, Rio Tinto and BHP Billiton dropped as Chinese iron ore futures fell to three-month lows, with oversupply worries weighing on steel prices. Citigroup said it was bearish on the outlook for iron ore, spurring further declines in contracts on the raw material.

Oil major BP was also a top faller, down 3.5 per cent as the price of crude fell after a US government report indicated rising production. The more domestically focused mid caps and small caps outperformed the blue chips, falling 1.1 and 0.5 per cent respectively but holding near record highs reached in the last trading session.

The top mid-cap fallers were all commodity-linked stocks, led by iron ore pellet producer Ferrexpo, down 11.5 per cent, and miner Vedanta Resources, down 8 per cent.

EUROPE

European stocks fell in a broad decline as geopolitical concerns weighed on traders as they returned to markets after the Easter holiday.

The Stoxx Europe 600 Index slipped 1.21 per cent on the day. All 19 industry groups fell, with miners leading declines as iron-ore prices tumbled.

Energy producers, construction companies and banks were also among the worst performers in the Stoxx 600.

Pandora slumped 12.12 per cent after Carnegie downgraded the stock to hold, saying a quarterly dealer survey indicated a visible deterioration in momentum.

Reversing some of last weeks loses, Spain's Banco Popular hiked up and closed at 6.22 per cent.

The earnings season will pick up pace later this week, with reports due from companies including Unilever and ABB.

NEW YORK

US stocks opened lower after Goldman Sachs Group stunned Wall Street by reporting a decline in revenues from bond trading, its traditional strength.

Bank of America reported a 40 per cent earnings' increase, topping analysts' estimates and offsetting some of Goldman's weakness.

The S&P 500 Index stumbled after its best day since March 1st, with shares of healthcare companies and finance firms leading the decline.

US Treasury yields fell as nervousness ahead of France’s first round of presidential elections this weekend and ongoing geopolitical tensions increased demand for safe-haven US debt.

The S&P 500 healthcare sector fell, dragged down by a decline in Johnson & Johnson after the company's quarterly revenue fell short of analysts' expectations.

- (Additional reporting: Bloomberg/Reuters)