World markets slip and sterling falls on talk of UK recession

World stock prices slipped modestly on Friday, while sterling dropped on bleak data that raised fears about a possible British recession following the country’s June 23rd vote to leave the European Union.

It was a quieter day in Dublin than in previous sessions, traders said. The Irish market finished marginally lower at 5,805.29, down 0.16 per cent.

DUBLIN

Earlier, the Iseq had been buoyed by market heavyweight CRH, which raised its first-half earnings forecast. The company’s shares account for more than a quarter of the Iseq. The stock finished the day at €26.84, almost 1.9 per cent higher, and hit €27.35 earlier in the session.

Ryanair, meanwhile, was down 1.2 per cent on decent volumes, finishing the day at just over €10.90 ahead of results on Monday.

Bank stocks had a decent run, with Permanent TSB rising almost half a percentage point to €2.19, and Bank of Ireland up 1.5 per cent to just over 20 cents a share.

LONDON

Britain’s top share index edged higher on hopes of further action from the Bank of England following poor economic data.

The blue-chip FTSE 100 was up 0.5 per cent at 6,730.48 points at its close, having opened lower, with the benchmark index posting its fifth straight week of gains following a gradual recovery after a post-Brexit sell-off.

Among other movers, Vodafone rose 4.6 per cent after the world’s second-largest mobile operator reported a better-than-expected 2.2 per cent gain in first-quarter organic service revenue, marking an eighth consecutive quarterly rise.

However, index gains were capped by some weaker companies. Marks & Spencer declined 3.6 per cent after Barclays downgraded the stock to “underweight” and cut its price target to 290p from 410p.

EasyJet also fell 3.7 per cent after ratings and target price cuts from Raymond James and Investec, extending its losses in the wake of Thursday’s disappointing results update.

EUROPE

The Stoxx Europe 600 Index dropped 0.1 per cent, trimming a loss of as much as 0.7 per cent. Germany’s manufacturing output reached the highest level since early 2014 and a composite Purchasing Managers’ Index for France stood at 50, the threshold that divides expansion from contraction, according to Markit Economics.

“Investors remain concerned on the prospects for economic growth in the euro zone after Brexit,” said Arno Endres, head analyst at Luzerner Kantonalbank in Switzerland.

The Stoxx 600, which hit a four-week high on Wednesday, ended little changed amid thin trading, trimming its weekly advance to 0.7 per cent. Europe’s broad FTSEurofirst 300 index dipped 0.15 per cent to 1,342.13, bogged down by lower mining shares and Swedish construction from Skanska.

NEW YORK

The S&P 500 and the Nasdaq inched higher, led by telecom stocks, while the Dow was held back by industrials after GE’s disappointing results. GE, long considered a bellwether for the US economy, dropped 2.1 per cent after its earnings report, while Honeywell fell 3.8 per cent after lowering its full-year sales forecast.

GE was the biggest loser on the Dow and the top drag on the S&P 500. It led the industrials sector down 0.8 per cent. Boeing and Caterpillar fell 1 per cent.

“The markets are biding time to see what the next set of earnings bring,” said Andre Bakhos, managing director at Janlyn Capital in Bernardsville, New Jersey. The weak results in the industrial sector was a “concern” and is a theme that markets could start to jump on, Mr Bakhos said.

At 3pm GMT, the Dow Jones Industrial Average was up 6.75 points, or 0.04 per cent, at 18,523.98. The S&P 500 was up 4.49 points, or 0.21 per cent, at 2,169.66. The Nasdaq Composite was up 15.89 points, or 0.31 percent, at 5,089.80.

Eight of the 10 major S&P indexes were higher, led by the telecoms sector’s 1.6 per cent gain. AT&T was up 1 per cent following its in-line results overnight. Verizon was up 1.3 per cent. The company is the front-runner for Yahoo’s core business after outbidding others including AT&T, Reuters reported. Yahoo was up nearly 1 per cent.

Additional reporting: Reuters, Bloomberg