Fallout from Trump immigration policy unsettles markets

Greek stocks hit hard in Europe due to growing concerns over bailout payment

 Donald Trump: investors have been assessing the potential for political fallout from immigration ban. Photograph: Jonathan Ernst/Reuters

Donald Trump: investors have been assessing the potential for political fallout from immigration ban. Photograph: Jonathan Ernst/Reuters

 

European equities fell, with the winners in a rally spurred by Donald Trump’s US victory turning into losers on Monday, as investors assessed the potential for political fallout from his order halting some immigration.

Greek stocks fell the most among western European markets on concern over the country’s bailout payment.

This negativity hit the market in Dublin with the Iseq Overall Index declining by 1.4 per cent to 6,441.43.

DUBLIN

A number of heavyweight stocks on the Iseq were among the biggest fallers on the day in Dublin. CRH was down 1.8 per cent at €32.76, Ryanair closed 1.9 per cent lower at €14.45, while Smurfit Kappa finished 1.7 per cent down at €24.29. Bank of Ireland’s good recent run came to an end, with the stock closing 5 per cent off at 25.3 cent.

Risers on the day included Paddy Power Betfair, up 1 per cent at €96.10, and Hostelworld, up 2.4 per cent at €2.55.

LONDON

The FTSE 100 fell into the red on Monday as investors lamented the effect of Mr Trump’s travel ban on global business.

London’s blue-chip index closed lower by 0.9 per cent or 66.01 points at 7,118.48 points, mirroring a dip in European equities.

Sterling also lost ground, falling 0.6 per cent against the US dollar to 1.247, and dropped 0.5 per cent against the euro to 1.167.

Investors were abandoning stocks and fleeing to safe haven assets such as gold, which rose nearly 0.4 per cent to $1,196.35 per ounce after Mr Trump introduced a travel ban on seven Muslim-majority countries and refugees.

In UK stocks, Vodafone shares rose 2.6p to 195.95p after the company confirmed that its Indian unit was in discussions to merge with Idea Cellular in a deal that would create the country’s biggest telecoms firm.

Lloyds Banking Group shares fell 0.96p to 64.91p as the government announced it had reduced its stake in the bank by about 1 per cent.

The biggest risers on the FTSE 100 were DCC, up 130p to 6,320p, Paddy Power Betfair, up 140p to 8,245p, and Pearson, up 8p to 615p.

The biggest fallers on the FTSE 100 were Tesco, down 8.75p to 197.8p, Rolls-Royce Holdings, down 26p to 660p, Old Mutual, down 7.3p to 205.9p, and Barclays, down 7.2p to 223.4p.

EUROPE

Miners, energy producers, banks and insurers – the best performers in the final quarter of 2016 – led losses in the Stoxx Europe 600 Index. The benchmark slid 1.1 per cent, the most since November 2nd.

Germany’s Dax Index fell the most in three months. Data showing the country’s inflation accelerating at its fastest pace in more than three years weighed on the region’s bond market.

Greece’s ASE Index dropped 3.5 per cent, capping its biggest two-day slide since the aftermath of the Brexit vote in June, after the government failed to bridge differences with European creditors over the conditions attached to the country’s latest bailout review.

NEW YORK

Wall Street’s main indexes were set for their worst day in more than three months on Monday, as Mr Trump’s orders to curb travel and immigration from some countries sparked uncertainty.

On Friday, Mr Trump signed executive orders to suspend travel to the United States from seven Muslim-majority countries on grounds of national security, while also banning refugees from Syria.

Thousands of people rallied in major US cities and at airports in protest. Nike and Starbucks were among the companies that did not support the ban.

At 10:58 am in New York, the Dow Jones Industrial Average was down 208.27 points, or 1.04 per cent, at 19,885.51. The S&P 500 was down 25.15 points, or 1.1 per cent, at 2,269.54 and the Nasdaq Composite was down 78.67 points, or 1.39 per cent, at 5,582.12.

Facebook and Apple, which are scheduled to report earnings this week, were the top drags on the S&P 500. Other technology stocks trading lower included Alphabet and Microsoft.

Airline stocks including American Airlines, United Continental and JetBlue were down between 3.3 per cent and 6.2 per cent.

– Additional reporting by Bloomberg, PA and Reuters