Decline in oil prices weigh on global energy stocks

European shares had an unsettled session on Monday. Having given up early advances to fall into the red late in the session as a decline in oil prices weighed on energy companies, the market managed to eke out a gain towards the end of the session.

The Stoxx Europe 600 Index, a benchmark for the European market, ended trading up 0.2 per cent.

DUBLIN

The Dublin market stood out as something of a bright spot in Europe, buoyed by a solid set of quarterly figures from Ryanair and, more importantly, as the airline confounded analysts by sticking to its full-year earnings guidance.

The Iseq index ended the session 0.5 per cent higher at 5,839.38.

Ryanair, which accounts for about 17 per cent of the Iseq, surged as much as 7.2 per cent as it reiterated its full-year net profit target of €1.375 billion to €1.425 billion, even as rivals including Aer Lingus owner IAG, EasyJet and Lufthansa have issued downbeat outlooks following the Brexit referendum and a number of terrorism attacks in Europe recently.

The carrier ended the session 6.7 per cent higher at €11.64.

"Overall, this was a better than expected performance and gives confidence that Ryanair can keep delivering in difficult times," said Mark Simpson, an analyst with Goodbody Stockbrokers.

Real estate investment trusts were in demand as the latest IPD/SCSI Ireland quarterly property report showed that commercial property rent growth has remained strong in the three months to the end of June.

Hibernia Reit gained 1.5 per cent, while Green added 1.4 per cent.

FBD added 1.5 per cent to €5.54 as the collapse of Gibraltar-based Enterprise Insurance, which had 14,000 Irish customers, is seen bolstering the insurance industry's drive to increase premiums and return to profitability.

However, banks were out of sorts, as nervous investors positioned themselves ahead of interim reports from the sector later this week. Bank of Ireland lost 4.9 per cent to 19.3 cents, while ended the session unchanged at €2.19, having earlier traded in the red.

LONDON

Britain’s top share index ended lower after hitting an 11-month high on Monday, with a fall in crude oil prices hurting energy stocks and weaker gold prices and negative company updates dragging down precious metals miners.

The internationally exposed FTSE 100 index finished 0.3 per cent weaker at 6,710.13 points after setting an intra-day peak of 6,756.13, the highest level since August last year. It is up 15 per cent since the post-Brexit slump, with its heavy weighting of exporters benefitting from a sharp fall in sterling.

Oil and gas firms led decliners after oil prices fell to two-and-a-half month lows amid worries that a global glut of crude and refined products would weigh on markets for some time.

Royal Dutch Shell, Tullow Oil, BP and Cairn Energy fell 2.6 to 7.2 per cent.

Precious metals miners came under selling pressure after gold prices fell on a firmer dollar and ahead of central bank meetings in the United States and Japan.

Shares in Randgold Resources, which have more than doubled this year as investors sought safe-haven assets, was down 3.4 per cent.

Outside of the blue chips, bookmaker William Hill surged 4.8 per cent after confirming it had received a takeover bid from Rank and 888 Holdings.

EUROPE

The European market was bolstered as German shares scraped out gains, after figures showed the Ifo institute’s index of German business sentiment fell less than expected in July. Benchmark gauges of Italy and Greece were among the biggest losers, falling more than 6 per cent.

Italian lender Banca Monte dei Paschi di Siena fell 9 per cent after a report that stress-test results due on Friday will show that the Italian lender's capital is at risk.

Air France-KLM lost 2.6 per cent after analysts Societe Generale recommended selling the shares.

Julius Baer Group Ltd rose 3 per cent after Switzerland's third-largest wealth manager reported a rise in first-half profit that beat expectations.

Ericsson increased 1.5 per cent as the Swedish telephone-equipment maker's chief executive officer stepped down after more than six years at the helm.

WALL STREET

US stocks slipped from their record levels on Monday as oil weighed on energy shares and as investors awaited this week's Federal Reserve monetary policy meeting.

By the time European markets closed, the Dow Jones Industrial Average was down 0.56 per cent, the S&P 500 was off 0.52 per cent and the Nasdaq Composite 0.22 per cent lower.

Yahoo's shares were down, after agreeing to sell its core internet business to Verizon for $4.8 billion. Verizon's shares were also in negative territory.

Wireless carrier Sprint shares soared after its first-quarter revenue beat estimates and the company said it had enough money to fund its business this year.