European shares fall for third consecutive day

Sterling climbs amid flicker of optimism on Brexit talks, sending FTSE 100 lower

Sterling rose after EU chief negotiator Michel Barnier said an agreement with the UK was still “within reach”. Photograph: Olivier Hoslet/AP

Sterling rose after EU chief negotiator Michel Barnier said an agreement with the UK was still “within reach”. Photograph: Olivier Hoslet/AP

 

European shares fell for a third straight session on Wednesday, as losses in healthcare and construction stocks countered a lift from encouraging earnings from consumer giant Nestle and telecoms equipment-maker Ericsson.

Sterling rose, sending the exporter-heavy FTSE 100 in London lower, after the EU’s chief negotiator Michel Barnier said an agreement between the EU and the UK on Brexit trade talks was still “within reach”.

DUBLIN

The Iseq dropped 1.6 per cent as Irish-listed stocks joined in the malaise across Europe. Ryanair was one of the key fallers, declining 2.9 per cent to €12.04, while building materials group CRH was also in the red, ending the session down almost 1.4 per cent at €31.60.

The banks were in the green, with Bank of Ireland rising 2.3 per cent to €1.88 and AIB up 1.6 per cent at 94 cent.

But food groups Kerry and Glanbia were in decline, with Kerry down 2 per cent at €108.70 and Glanbia 0.6 per cent lower at €8.38.

Dalata Hotel Group fell 4.3 per cent to €2.24, while Cairn Homes was 2.8 per cent lower at just under 83 cent.

Packaging group Smurfit Kappa joined in the negative mood, slipping 0.5 per cent to €34.60.

LONDON

London’s FTSE 100 underperformed, marking its worst session in a month. A surge for sterling on currency markets after bullish Brexit comments sent the index down 1.9 per cent. The rally for the pound weighed on stocks such as British American Tobacco, Diageo, Unilever, AstraZeneca and GlaxoSmithKline.

The more domestically-focused FTSE 250 was 0.8 per cent lower on the day.

International Consolidated Airlines Group (IAG), the owner of Aer Lingus, was one of the biggest fallers, declining 6 per cent.

Precious metals miner Fresnillo dropped 4.35 and FTSE 250-listed gold miner Centamin slumped 19.2 per cent after both companies cut their production forecasts.

Shares in bookmaker William Hill gained 0.4 per cent despite its warning that the local Covid-19 lockdowns would close one in 10 of its betting shops.

Metro jumped 2.5 per cent after the bank said deposits were up by 10 per cent and that it had provided £1.3 billion in Covid-19 loans to British businesses.

EUROPE

The pan-European Stoxx 600 fell 1.3 per cent to close at its lowest in more than two weeks. Germany’s Dax index increased 1.4 per cent in Frankfurt, while the Cac 40 in Paris added 1.5 per cent.

Swiss chocolate and pet food maker Nestlé lifted its 2020 sales forecast following a quarterly beat, but shares inched lower after early gains.

Sweden’s Ericsson was a bright spot, jumping 9.6 per cent as higher margins and China’s 5G rollout helped the company beat quarterly core earnings estimates.

Vivendi rose 1.6 per cent after the French media group reported a bigger-than-expected quarterly sales and unveiled plans to list its most-prized asset, Universal Music Group, in 2022.

Dutch paints and coatings maker AkzoNobel edged 0.8 per cent lower despite reporting a recovery in its sales after a coronavirus-related slump earlier in 2020.

US

Wall Street swung between gains and losses as investors assessed the latest headlines on the state of aid-deal talks.

The S&P 500 Index turned lower in afternoon trading, giving up a brief bounce sparked by house speaker Nancy Pelosi’s upbeat take on negotiations even as the odds remained long for a deal before the November 3rd election.

Energy producers were among the worst performers as oil fell toward $40 a barrel in New York. Social media firms fared better after Snap reported strong earnings, with Twitter and Facebook both up more than 5 per cent at one point.

Netflix slipped as much as 6.7 per cent after new subscriber additions in the third quarter fell short of predictions. – Additional reporting: Reuters/Bloomberg