European shares scale to new highs even as Iseq heavyweights drag

European shares climbed to fresh record highs on Friday as British-exposed financial stocks gained following a hawkish comment from a Bank of England official, though Dublin's Iseq index ended the session in negative territory as market heavyweights CRH and Kerry Group dipped.

The pan-European Stoxx 600 index rose 0.6 per cent to a record high of 448.98 points and added 1 per cent this week.

British lenders, including HSBC, led the gains after a Bank of England policymaker suggested an earlier-than-signalled hike in lending rates.

Dublin

The Iseq index fell by 0.3 per cent to 8,283.30. While Bank of Ireland would stand to benefit most among Irish financial stocks from rising UK interest rates, it dipped 0.8 per cent to €5.32 per cent. AIB, on the other hand, jumped 4.2 per cent to €2.74.

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Hibernia Reit was another strong spot in Dublin, gaining 2.9 per cent to €1.20 after The Irish Times reported KPMG has selected the property group as the preferred bidder for the delivery of its new Dublin headquarters on the site of the current Dublin regional Garda headquarters on Harcourt Street.

Housebuilder Glenveagh Properties added 3.1 per cent to 99c as it began a €75 million share buyback programme, while rival Cairn Homes added 1.7 per cent to €1.71.

London

The FTSE 100 was unchanged on Friday, as weakness in miners and energy stocks countered gains in bank shares, while the prospect of further stimulus in the US made investors optimistic of speedy economic recovery.

Homebuilders jumped with Vistry Group and Taylor Wimpey gaining 4.2 per cent and 2.6 per cent, respectively.

Miners, including BHP Group, Antofagasta and oil majors BP and Royal Dutch Shell were the biggest drags of the index.

Irish-based but London-listed C&C Group slipped 3.4 per cent and was among the top losers of the FTSE 250 index as investors continued to digest news this week of cider and beer maker's planned £151 million (€175.6 million) share sale.

Europe

Optimism over economic growth has supported European stocks this year, with several economies loosening their Covid-19 curbs against the backdrop of a steady vaccination campaign.

The reopening measures have boosted the travel and leisure stocks, which outpaced their regional peers this week with a 4 per cent jump.

Data showed economic sentiment improved by more than expected to a three-year high in May, with the strongest gains in services, retail and among consumers as governments eased pandemic restrictions.

Markets also took comfort in the prospect of more liquidity, after a report said US president Joe Biden would seek $6 trillion (€5.74 trillion) in federal spending for 2022.

Among individual movers, Spanish bank Sabadell fell more than 6.5 per cent even after it outlined plans for more cost cuts to improve profitability.

French aircraft-maker Airbus extended solid gains from Thursday, hitting a near 15-month high after it outlined plans to nearly double output.

New York

Wall Street’s major share indices were ahead in early afternoon trading as investors shrugged off data showing a jump in inflation, although recent worries about a spike in prices kept the S&P 500 on course for its smallest monthly gain since February.

Consumer prices as measured by the personal consumption expenditures price index jumped 3.1 per cent on the year in April, blowing past the Federal Reserve’s 2 per cent target and reflecting pent-up demand as the economy reopens.

Dell Technologies and HP reported quarterly revenue that beat analysts' estimates but their shares fell after they warned that the ongoing computer-chip shortage could impact its ability to meet demand for laptops this year.

Boeing fell after reports said it had halted deliveries of its 787 Dreamliners, adding fresh delays for customers following a recent five-month delivery suspension due to production problems. – Additional reporting, Reuters