Banking shares suffer despite rise in European stocks
Bank of Ireland was among the fallers, declining 3.2% to 24 cent
Wall Street stocks pared gains in early afternoon trading on Tuesday as a fall in oil prices dragged down energy shares.
European stocks advanced as the FTSE 250 index of mid-cap companies jumped to record close and real estate stocks made gains. However, both the French and Irish markets finished in negative territory.
Property companies were buoyed as bonds rallied across Europe and lifted shares that are bought as proxies for fixed income.
The effect hurt banking shares, which retreated for a second day along with German debt yields, while BNP Paribas’s results missed estimates.
The Iseq index closed down 0.75 per cent, underperforming the major European indices, and going against the generally positive trend, following drops for its two biggest stocks. Cement-maker CRH closed down 2.1 per cent at €32, while Ryanair slipped 1.6 per cent to just under €14. This compounded a 3.8 per cent decline for the airline on Monday, when it highlighted a weak revenue environment.
Bank of Ireland was also among the fallers, declining 3.2 per cent to 24 cent in line with poor sentiment towards financial stocks across Europe. However, food group Kerry climbed 1.1 per cent to €66.51, while building materials group Kingspan advanced 1 per cent to €27.15 and cheese-maker Glanbia finished up 1.4 per cent at €16.02.
Paper and packaging group Smurfit Kappa also made gains, closing up 0.7 per cent at €24.87 ahead of its interim results, scheduled for Wednesday.
The FTSE 100 of blue-chip shares rose 0.2 per cent on Tuesday, while the FTSE 250, home to smaller, more UK-focused companies, climbed 1 per cent to an all-time high.
Shares in BP fell 4.1 per cent after the oil company reported fourth-quarter earnings that missed analyst estimates as higher crude prices failed to fully compensate for lower income from refining.
London-listed, but Dublin-based, DCC rose 5.6 per cent after announcing it would buy the retail petrol station network of ExxonMobil’s Norwegian unit, Esso Norge, for 2.43 billion Norwegian crowns. This was its biggest one-day gain since November 2015.
Engine-maker Rolls-Royce, education publisher Pearson and mining stocks Fresnillo and Randgold Resources were also among the climbers.
The Stoxx Europe 600 Index closed 0.3 per cent higher, with the property sector gaining 1.7 per cent. The broader index dropped 0.7 per cent in the previous session, as investors turned cautious on the region’s assets after French presidential candidate Marine Le Pen over the weekend unveiled a manifesto pledge to take the country out of the currency bloc should she win.
The Euro Stoxx 50, a gauge of euro-area shares, ended the session little changed. In Frankfurt, the Dax closed up 0.3 per cent, while the Cac 40 in Paris fell 0.5 per cent. French bank BNP Paribas fell 4.8 percent to a two-month low, after posting fourth-quarter profit that missed estimates.
There were well received updates from Austrian chipmaker AMS, which rose 22.4 percent, scoring its biggest one-day gain ever, and German food-processing machinery maker GEA , which added 3.6 percent after setting a brighter profit outlook.
Meanwhile, data showed German industrial production unexpectedly fell in December, led by a contraction in manufacturing and construction.
Wall Street stocks pared gains in early afternoon trading on Tuesday as a fall in oil prices dragged down energy shares. The Dow Jones Industrial Average and the Nasdaq Composite hit all-time highs just after the market opened, with the S&P 500 coming within spitting distance of yet another record high.
Oil prices were pressured by sluggish demand and evidence of a burgeoning revival in US shale production that could complicate efforts by Opec and other producers to reduce a supply glut. Chevron’s 1.3 per cent fall and Exxon’s 1 per cent drop weighed the most on the S&P and the Dow.
General Motors slipped 4.8 per cent after the automaker said fourth-quarter net income fell partly because of $500 million in foreign exchange losses. Twenty-First Century Fox fell 1.5 per cent after its quarterly revenue missed expectations.
(Additional reporting: Bloomberg / Reuters.)