European stocks gain but French cloud looms large
Smurfit Kappa and Providence Resources gain in Ireland while Ryanair reverses gains
Gains for financial stocks lead to a rise in European shares. Photograph: Getty Images/Moodboard RF
European shares rose on Wednesday, driven by gains in financial stocks and carmakers, as the first-quarter earnings season kicked off and a rise in the oil price underpinned energy stocks.
Packaging company Smurfit Kappa was the biggest gainer on the Iseq on Wednesday. The stock closed the day up 2.31 per cent at €24.37.
Profit-taking across the airline sector led to Ryanair’s Irish listing losing some of Tuesday’s gains and closing down just 0.59 per cent at €15.25.
Brent oil made gains after Saudi Arabia was said to be pushing its fellow Opec members and some rivals to prolong supply cuts beyond June. Dealers suggested that that change in the oil price put slight pressure on airline stocks.
Losses for Providence Resources narrowed in 2016 and that led the stock to close toward the top of the Iseq overall index up 7.32 per cent at €0.22.
European banks moved higher and so too did Bank of Ireland – paring back some of yesterday’s losses. The stock closed up 1.26 per cent at €0.24.
As the negativity surrounding the French elections continue investors are said to be making a move into food stocks. As a result, Aryzta, Total Produce and Glanbia all saw gains on the Iseq. The biggest mover in food was Total Produce which closed up 2.05 per cent at €1.99.
CRH lost some of Tuesday’s gains as little came from US president Donald Trump’s infrastructure announcement. The stock closed down 0.11 per cent at €32.315.
Industrial stocks led gains on the FTSE, with engineer Rolls Royce gaining the most, 2.47 per cent.
British grocers fell, led by Tesco. Its shares dropped 5.37 per cent after the company reported full-year figures. Tesco’s full-year profit beat forecasts, rising 30 per cent, but analysts flagged such negatives as a decline in international margin and a slowdown in UK and Ireland margins.
Peers Morrison’s and Sainsbury also fell, by 1.74 and 2.68 per cent respectively. Mid-cap Booker Group, which has agreed to a £3.7 billion takeover by Tesco, also dropped.
Shares in recruiter Pagegroup rose the most among British mid caps, rising 4.46 per cent. The company posted a record quarterly gross profit that beat expectations, helped by growth in its markets outside the UK.
The pan-European Stoxx 600 index was up 0.22 per cent by the close of business, having hit a fresh 16-month high earlier.
Car stocks performed well, rising by 0.14 per cent.
French car parts manufacturer Faurecia gained 1.04 per cent after it posted first-quarter sales up 10 pe r cent to €4.23 billion. Deutsche Bank said strong results over consecutive semesters should feed through into a valuation which is one of the lowest in the sector.
German luxury carmaker Daimler gained 0.27 per cent after it said first-quarter profits jumped 87 per cent on strong Mercedes sales.
Dialog Semiconductor fell for a second day – down 1.63 per cent – but wasn’t as close to the bottom of Europe’s Stoxx 600 index as it was the previous day.
Arcelormittal and Banco Popular were the big European losers of the day, down 5.73 and 4.37 per cent respectively.
US stocks edged lower on Wednesday as investors assessed uncertainty stemming from rising geopolitical tensions and the upcoming corporate earnings season.
The S&P 500 fell below its 50-day moving average, while the price of gold and VIX, Wall Street’s fear gauge, rose to their highest levels since November.
Financials were the worst hit on Wednesday. JPMorgan, Citigroup and Wells Fargo are scheduled to report results on Thursday, which will be the last trading day of the week on Wall Street ahead of the Good Friday holiday.
Chipmaker Qualcomm dropped after it was asked to refund Canada’s BlackBerry $814.9 million in an arbitration settlement.
Delta Air Lines was up, boosted by a quarterly profit update.
–(Additional reporting: Reuters)