Dollar slump hits European shares with CRH and Kingspan among losers

A slump in the dollar hit European shares on Wednesday and dragged most of the continent’s indexes into negative territory as Wall Street rose.

US stocks declined in early trading as Trump administration officials stepped up protectionist rhetoric. The dollar sank to a three-year low after American officials endorsed a weaker currency to boost exports.

Dublin

The Iseq followed other European bourses lower on Wednesday, closing 1 per cent down to 7,156.40 with FX-headwinds hurting companies with a heavy US exposure.

Iseq mainstay CRH was down 1.85 per cent to €30.96. The slump in the dollar also weighed on Kingspan, which lost 1.6 per cent to €37.34 and Glanbia, down 1 per cent to €13.94.

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Ryanair, which rose earlier in the week on the back of EasyJet's latest results, pared back most of the gains, ending down 1.3 per cent to €16.63.

Dalata had a weak day with shares falling by 4 per cent on low volumes. Bank of Ireland also gave up some ground after a strong year-to-date, closing down 1.2 per cent to €8.04.

London

Britain’s top share index fell on Wednesday as sterling was pushed to a post-Brexit-vote high by data showing that the number of people in work had surged unexpectedly. The FTSE 100 ended the session down 1.1 per cent at a three-week low of 7,643.43 points. The blue-chip index underperformed its continental European peers as the pound rose above $1.42, a level not seen since June 2016.

Software company Sage Group was by far the worst performer, down 6.5 per cent after its first-quarter results. "Q1 is slightly disappointing, even allowing for usually slower growth rates at this juncture," Investec analysts said.

Shares in exchange operator LSE led the 20 or so stocks in positive territory, rising 5 per cent on the back of a media report saying that activist hedge fund TCI was predicting a £15 billion takeover bid for the company.

British pubs group JD Wetherspoon issued upbeat guidance and strong comparable sales in the Christmas period, lifting its share price by 2.3 per cent.

Europe

A decline in utility stocks following a profit warning at France's Suez weighed on Wednesday, while a strong update from Novartis provided some support.

The pan-European STOXX 600 index closed down 0.4 per cent while Germany’s DAX dipped 0.8 per cent.

Suez slumped over 16 per cent after the waste and water group revised down its 2017 earnings target due to additional costs in Spain and decisions to close services contracts in Morocco and India. Its fall dragged peer Veolia down 3.8 per cent .

Drugmaker Novartis gained 2.7 per cent after the Swiss group forecast 2018 operating profit would grow faster than sales as revenue from drugs accelerates and it exits a period when patent losses dented results.

AP Moeller-Maersk was another strong gainer, up 3.1 per cent. Shares in the world's largest container shipping firm were supported by reports it is seeking a partner for its drilling unit, while a trader also cited an upgrade to "buy" at SEB Equities.

Wall Street

GE shares were down 2.7 per cent in early trading after it disclosed a $9.8 billion loss. In the latest blow to the largest US industrial conglomerate, US securities regulators are probing a massive insurance charge GE announced last week. It also forecast more weakness at its power business this year, a unit that produced 60 per cent of profits as recently as 2016.

Shares in Royal Caribbean, the second-largest US cruise operator, rose as much as 5.92 per cent to hit a record high of $134.75 after it reported fourth-quarter results that beat Wall Street estimates.

Chipmaker Qualcomm saw its share price stabilise down 1.3 per cent having dropped by 5 per cent in pre-market trading after it was hit with a €997 million fine by European Union anti-trust regulators.

Additional reporting: Reuters