Global shares fell on Monday, as traders sold off stocks amid renewed attacks by the US and Iran which threatened another squeeze on energy supplies to the world economy. Closer to home, the Irish and UK banks were among the strongest gains in their respective stock markets.
DUBLIN
The Iseq Overall index was little change on Monday to close at 14,212.84, following a strong day for the banks.
AIB saw its share price increase 1.29 per cent to close at €10.97 , with Bank of Ireland following closely with a 1.17 per cent increase to close at €18.99 a share. Permanent TSB was unchanged .
Cairn Homes fell 2.13 per cent to close at €2.53. Irish Ferries owner Irish Continental Group also decreased 1.92 per cent to close at €7.16. Ryanair had a similarly disappointing day after its share price fell 1.36 per cent to close at €23.20.
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Developer Glenveagh was largely unchanged, following the publication of a report in which it recommended 40 different policies the Government should adopt to increase the rate of homebuilding across the State, many of which focused on reforms to land laws that seemingly slow this process.
LONDON
UK markets were closed for the public holiday there.
EUROPE
Shares across the Continent fell on Monday during an otherwise light day of trading volume, with the pan-European Stoxx 600 index dipping 0.61 per cent at close of markets and the blue-chip Stoxx 50 index falling 1.07 per cent by the end of the trading day.
Italian oil, natural gas and electricity provider Eni was the day’s top gainer on the Stoxx 50 index. It saw its share price increase 2.26 per cent following the announcement of an agreement with the Uruguayan subsidiary of an Argentinian gas company that will allow it access offshore mining in South America.
On the Stoxx 600 index, shares in French semiconductor materials manufacturer Soitec rose 6.39 per cent, while German financial solutions firm Close Brothers saw its stock soar 7.45 per cent.
NEW YORK
Early trading on Wall Street saw stocks slump before midday New York time on Monday, as not even sizeable gains for energy companies could counterbalance larger losses led by declining shares in interest-rate sensitive utility companies. The S&P 500 index fell some 0.40 per cent, while the Dow Jones Industrial Average followed suit by dropping nearly 0.60 per cent.
Oil companies were the sole gainer during early hours on the S&P 500 index following the exchange of air strikes between the US and Iran in the Middle East. After the US air force struck Iranian military personnel in the Strait of Hormuz, Tehran responded with a drone attack on a US airbase in Jordan.
These renewed tensions increased concerns that a military escalation in the war could further curtail shipping through Hormuz and cause additional upheaval in energy markets.
“With traders tracking geopolitical volatility as well as potential seasonal volatility, it will be interesting to see which market impulse from last week might carry over to this week,” said Chris Larkin at E*Trade from Morgan Stanley. “Unexpectedly strong labour-market data might be taken as bad news by the market, since it could reinforce expectations for a rate hike.”
The US jobs report Friday is expected to be consistent with general steadiness in the labour market that’s helping the Federal Reserve focus more intently on its battle with inflation. Economists estimate the data will show a 55,000 increase in August payrolls after an unexpected dip in July employment. Such a result would be broadly in line with average job growth this year.
Friday’s jobs report “will be critical,” with figures on consumer prices, due on September 11th, being the more important of the two prints, given Warsh’s view that the US is at full employment, according to JPMorgan Chase’s Andrew Tyler.
– Additional reporting: Bloomberg.
