Global markets shrug off US-China trade war fears

European shares shuddered then recovered after Beijing hit back with tariffs on US goods

The site of Green Reit at Molesworth and Dawson Street. Photograph: Cyril Byrne

The site of Green Reit at Molesworth and Dawson Street. Photograph: Cyril Byrne

 

Global equity markets climbed on Tuesday, shrugging off the latest salvos in the intensifying trade war between the US and China. Treasuries retreated and oil rose.

Britain’s top share index, the Ftse 100, barely budged as investors took in their stride the US-China escalation.

European indexes tracked higher, including the French Cac, which was 0.28 per cent higher, and the German Dax was up 0.51 per cent.

Dublin

The Iseq rose more than 0.5 per cent on slack trading volumes.

Green Reit rose 1.4 per cent to close at €1.58, after it released full-year results that were well ahead of analyst estimates. The property company reported a spike in its profits of 11 per cent.

Glanbia, which has major operations in the US, fell more than 0.5 per cent to close the session at €14.62. Kingspan, which also has a large US presence, fell 0.24 per cent to €42.40.

Other US-focused Irish stocks, however, shrugged off trade war fears. CRH rose about 0.75 per cent to €27.68, while Kerry group was up almost 0.5 per cent to €96.50.

London

The biggest drag on the Ftse on Tuesday was tobacco firm BAT, which fell 1.9 per cent after Morgan Stanley started covering the stock with an equal-weight rating. Its rival Imperial Brands also fell 1.8 per cent.

Serviced offices provider IWG fell 6.6 per cent after Credit Suisse analysts downgraded the stock to “underperform” from “neutral”, citing risks to earnings from the implementation of new accounting standards and the departure of its finance chief.

Broadcaster ITV dropped 3 per cent after its chief executive declined to say whether it had bid for Netherlands-based production company Endemol Shine.

Ocado rose 0.6 per cent after the online supermarket said retail sales growth slowed a touch in the latest quarter, though it was in line with the group’s guidance for the full year.

Miners were broadly higher, with shares in Glencore, Anglo American and Antofagasta trading up 1.8-2.8 per cent. Fresnillo was up 1 per cent, supported by an analyst upgrade.

Europe

European shares shuddered, then recovered, after Beijing retaliated with new tariffs on $60 billion worth of US goods.

On the corporate front, dealmaking prompted steep moves across European bourses. The top gainer was Norway’s Schibsted, up 9.1 per cent after it said it would spin off its international online classifieds.

Denmark’s Pandora jumped as much as 10 per cent, ending the day up 6.8 per cent after a media report that private equity funds are studying a potential takeover bid.

The German outfit Zalando, Europe’s biggest pure online fashion retailer, was the worst performer, down 14 percent after blaming a long, hot summer for cutting its 2018 outlook. Its main shareholder, Kinnevik, which holds about a 31 percent stake, fell 7 per cent.

Dutch digital mapping firm TomTom ended the day down 24 per cent after Renault, Nissan and Mitsubishi announced a partnership with rival Google.

New York

The tech index, which dropped 1.4 per cent on Monday ahead of the tariff announcement, had climbed 1.05 percent heading into Tuesday afternoon, lifted by a 0.7 per cent gain in Apple.

The consumer discretionary sector gained 1.20 per cent, boosted by a 2.5 per cent gain in Amazon.

Stocks in the so-called FAANG group of leading tech stocks were also higher. Netflix was up 3.5 per cent, while Google parent Alphabet rose 1.7 per cent.

Six of the 11 major S&P sectors were higher. The energy sector rose 0.96 per cent, after oil prices climbed on signs that the OPEC may not be prepared to raise output.

General Mills fell 7.9 per cent, the most on the S&P, after the Cheerios cereal maker fell short of sales and margins estimates.

(Additional reporting: Reuters/Bloomberg)