European stocks slip as defensives weigh, UK shrugs off latest lockdown
BP, Shell provide biggest boosts to FTSE 100 while Next jumps after Christmas update
In Dublin, the Iseq index of leading shares was down 1 per cent in early trading to 7417.09
European stocks slipped on Tuesday as losses in defensive sectors offset gains in oil and retail stocks, while investors looked past a new national lockdown in Britain to curb a surge in coronavirus cases.
In Dublin, the Iseq index of leading shares was down 1 per cent in early trading to 7417.09. Among the mover were Kingspan, down 2.4 per cent, Ryanair, wich was 1.3 per cent lower, and Smurfit Kappa, down 2 per cent. It was a mixed bag on the banking front with Bank of Ireland up 3.8 per cent but AIB losing 3.3 per cent.
The FTSE 100 rose 0.3 per cent, boosted by oil majors Royal Dutch Shell and BP, as crude prices inched higher with deadlocked talks between major producers about potential changes in February output set to continue.
The domestically focussed midcap index gained 0.6 per cent as Chancellor of the Exchequer Rishi Sunak announced plans to support businesses struggling under a third Covid-19 lockdown.
“It doesn’t seem like restrictions have much of an impact as traders are fixated on the wider story that vaccines are being distributed and the world should be in a very different place in another two to four months,” said David Madden, analyst at CMC Markets.
European stocks rallied to fresh February highs on the first trading session in 2021 on Monday on hopes the vaccines will spur a speedy economic rebound.
The global mood dampened on Tuesday ahead of the Senate election outcome, which could have a big impact on incoming US president Joe Biden’s ability to pursue his preferred economic policies.
Stocks considered as safe-havens like utilities, healthcare and food & beverage fell the most among European sectors.
Germany’s DAX index inched 0.2 per cent lower with the government looking to extend a lockdown, while France’s CAC 40 slipped 0.3per cent.
Retailers were a bright spot, with Britain’s Next jumping 8.4 per centafter it said its Christmas sales were much better than expected.
German chipmaker Dialog Semiconductor gained 3.7 per cent after it gave an upbeat fourth-quarter revenue forecast due to strong demand for 5G phones and tablets.
ASML rose 0.7 per cent after analysts at RBC and Liberum raised their price targets on the stock.
- Additional reporting: Reuters