Markets

European stocks slip back from all-time highs

Ryanair climbs 4% as it signals strong summer bookings

Ryanair’s stock closed higher on Monday. Photograph: Tobias Schwarz/AFP

Mon Jul 26 2021 - 18:14

European stocks eased from all-time highs on Monday, hurt by a decline in shares of Dutch technology investor Prosus after regulatory clampdowns in China.

Despite concerns about surging Covid-19 cases globally and rising inflation, the benchmark Stoxx 600 index had hit a record high on Friday.

DUBLIN

The Iseq nudged up 0.3 per cent, with the index dragged into the green by a 3.8 per cent gain for Ryanair after it said it expected to carry more than 10 million passengers in August, double the June number, as it reported quarterly results.

The airline closed at €16.39 on its Dublin listing as investors responded positively to comments from Michael O’Leary on its full-year outlook. The group’s chief executive said traffic in its current financial year had improved to a range of 90 million-100 million, compared with previous guidance that it would arrive at the lower end of a range of 80 million-120 million.

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Elsewhere, banking stocks saw continued momentum from the end of last week, with AIB rising 3.6 per cent to €2.08 and Bank of Ireland adding 3.2 per cent to close at €4.38.

Building materials group CRH rose 0.55 per cent to €41.68, while packaging company Smurfit Kappa slipped 0.3 per cent to €46.92. Other stocks struggled to gain any ground on low trading volumes.

LONDON

The Ftse 100 index ended flat as weakness in healthcare stocks and a stronger pound offset gains in commodity-linked shares, while Ryanair also climbed on its London listing.

Dollar-earning consumer staples stocks, including Unilever, Reckitt Benckiser and Diageo fell 0.6-2.6 per cent due to the stronger pound and were among the top drags on the blue-chip index. The Ftse 250 mid-cap index added 0.2 per cent.

London-listed shares of Ryanair jumped 4 per cent after it slightly increased its forecast for full-year traffic on strong summer bookings.

Mining stocks Antofagasta, Rio Tinto and Anglo American, meanwhile, were among the top gainers on strong base metal prices.

The energy sector gained 2.7 per cent, with Royal Dutch Shell up 2.5 per cent after the oil major announced plans to develop a new oilfield in the Gulf of Mexico, its first major project to get the go-ahead since a Dutch court ordered it to accelerate carbon emissions reduction targets.

EUROPE

The pan-European Stoxx 600 index fell 0.1 per cent, snapping a four-session rally. Germany’s Dax index fell 0.3 per cent after an IFO institute survey showed business morale in the country fell unexpectedly in July amid continuing supply chain worries. French stocks eked out a 0.15 per cent gain.

Dutch company Prosus, which has a 28.9 per cent stake in Tencent, tumbled 8.8 per cent to a more than one-year low after Beijing intensified its regulatory crackdown on the Chinese internet giant.

Automotive manufacturers found reverse gear. Porsche was down 1.9 per cent as it traded without entitlement for dividend, and French car parts maker Faurecia fell 5.7 per cent despite raising its 2021 net cash flow target.

Spanish pharmaceuticals company Almirall fell 11.6 per cent after posting a first-half net loss of €42.8 million. German biotech firm Morphosys slid 8.7 per cent after cutting its revenue guidance for 2021.

US

Wall Street stocks slipped from record highs and the dollar softened as investors cashed in on recent gains and turned their focus to the Federal Reserve’s policy meeting, starting Tuesday, for clues on the outlook for monetary policy.

Bitcoin, the world’s biggest cryptocurrency and sometimes an indicator of the demand for risk, soared 8.3 per cent, while ether jumped 6.35 per cent.

Speculation that online retailing giant Amazon might accept bitcoin as payment sparked the latest rally, and short sellers covering their positions added to the surge. Amazon's stock was 1 per cent higher at the halfway point of the session.

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