Global markets agitated by potential Evergrande crisis

In Dublin, the banks finished the day down, while industrial and material names were up

The Evergrande name and logo are seen outside the construction site of an Evergrande housing complex in Beijing

The Evergrande name and logo are seen outside the construction site of an Evergrande housing complex in Beijing

 

Global markets were agitated on Monday by concerns the potential default by Evergrande, the world’s biggest property developer, could hurt China’s real estate sector, banks, and the global economy.

Dublin

Euronext Dublin finished the day up 0.5 per cent, underperforming compared with some of its European peers.

US fantasy sports and sports betting company DraftKings made a roughly £16.6 billion offer for UK gambling company Entain, which soared 18 per cent on the back of the news. Paddy Power Betfair parent Flutter Entertainment benefitted from the momentum and finished the day up 3.5 per cent.

It was also a positive day for industrial and material names as insulation maker Kingspan and Grafton Group both finished up 1 per cent. “A lot of that was a rebound from a sell-off yesterday,” noted a trader. Elsewhere, CRH finished the day flat.

In terms of groups in the red, Bank of Ireland was down 2 per cent while AIB was down about 25 basis points.

Among the airlines, Ryanair was off about 1 per cent after the positive run on Monday. Dalata Group, the biggest hotel operator in the State, was up 2 per cent as it clawed back losses in recent days.

London

The blue-chip FTSE 100 ended 1 per cent higher and recorded its best session in two months. Oil majors BP and Royal Dutch Shell were among the top performers.

Healthcare stocks gained 1.5 per cent with drugmakers including AstraZeneca, Indivior, Oxford BioMedica up between 1.6 per cent and 4.8 per cent.

The domestically focussed mid-cap index rose 0.8 per cent, with travel stocks being among the top gainers.

In earnings-driven moves, Kingfisher fell 4.9 per cent to the bottom of the FTSE 100 even as the British home improvement retailer reported a jump in first-half profit.

Royal Dutch Shell jumped 3.6 per cent after it said it would sell its Permian Basin assets to ConocoPhillips for $9.5 billion in cash, exiting the largest US oilfield.

British transport company Stagecoach Group surged 27 per cent to the top of mid-cap index, after it said it was in talks with rival operator National Express about a possible all-share merger. National Express was up 7.6 per cent.

Europe

European shares rose after their biggest dip in two months on easing worries about the spill-over from the crisis at China’s Evergrande, while music label Universal Music Group soared 35 per cent in its stock market debut.

The pan- European Stoxxx 600 was up 1 per cent after sinking to a two-month low in the previous session.

Travel and leisure, media, mining and energy stocks led gains, while Germany’s DAX rebounded from its lowest level since late July.

“European markets have been much more adept at holding on to their gains today than their US counterparts,” said Chris Beauchamp, chief market analyst at IG.

Travel-related stocks including British Airways-owner IAG, cruiseliner Carnival and InterContinental Hotels Group jumped between 2 per cent and 5 per cent following the relaxation of US travel curbs.

Universal Music Group, the business behind singers such as Lady Gaga, Taylor Swift and The Weeknd, surged 35.7 per cent in its first day of trading, giving it a market capitalisation of more than €46 billion. Shares of owner Vivendi soared 67.2 per cent.

New York

US stock indices rose, recovering from a selloff a day earlier, as investors weighed the risk of contagion from troubles at Evergrande, while awaiting the outcome of a Federal Reserve policy meeting.

Healthcare and property, seen as defensive sectors in a volatile market, were the top performers. The S&P 500 index traded substantially below its 50-day moving average, its first major breach in more than six months. The average has served as a floor of sorts for the index this year.

Among other movers, energy stocks rose 0.3 per cent as oil prices gained on signs of tight US supply due to the aftermath of Hurricane Ida. (Additional reporting: Agencies)