Banks and oil companies led European stocks lower on Tuesday as investors turned wary ahead of the US Federal Reserve’s policy meeting.
The Iseq all-share index underperformed compared to its European peers on Tuesday, with many of the big names on the index closing lower despite little in the way of stock-specific news. The index fell 2.55 per cent.
Banks were among the biggest losers, with AIB tumbling 8.94 per cent to €1.14 while Bank of Ireland declined 7.81 per cent to €1.86.
Despite news last week that the Government will reopen the economy sooner than planned, Dalata Hotel Group was another significant loser on the day when guidelines for the sector were made public. The company fell 11.87 per cent to €3.34.
It was also a volatile day in the airline sector, with European names such as IAG and Air France falling by between 6 and 8 per cent. Ryanair closed 5.12 per cent lower on its Irish listing at €12.15.
In what was mainly a sea of red on the day, Smurfit Kappa closed down 3.11 per cent at €28.62 while Paddy Power owner Flutter Entertainment ended the session 5.37 per cent lower at €119.90.
There was no consistency in the food sector, often defensive stocks. Glanbia was 2.46 per cent lower at €10.69 while Kerry Group was among the few gainers, closing 0.47 per cent higher at €107.90.
HSBC fell 3.6 per cent and was the biggest weight on the FTSE 100 index after Aviva Investors, a top-20 investor in both the bank and peer Standard Chartered, raised concerns over its support for the law.
The blue-chip FTSE 100 declined 2.1 per cent, with cigarette maker British American Tobacco falling 3.1 per cent after it flagged a demand hit due to prolonged lockdowns in South Africa and Mexico and weak sales in Bangladesh and Vietnam.
Bellway dropped 5.7 per cent, dragging its peers down with it, as the housebuilder sold fewer homes between August and May due to restricted business activity induced by the coronavirus lockdown.
Royal Dutch Shell said it will restart drilling and begin redeploying some non-essential personnel on some of its offshore assets in the Gulf of Mexico on Monday and Tuesday as conditions improve following tropical storm Cristobal. Shares of the company, however, fell 4.4 per cent tracking weaker oil prices.
The pan-European Stoxx 600 index fell 1.2 per cent, while the main markets in Frankfurt, London and Paris were down between 1.6 per cent and 2.1 per cent.
After a stunning 46 per cent recovery from all-time lows, euro zone banks fell 3.8 per cent after an EU financial stability watchdog said banks should not be allowed to pay dividends at least until the end of this year.
Oil majors Royal Dutch Shell, BP and Total fell between 3 per cent and 4.5 per cent.
Sectors considered most geared to economic growth such as automakers, travel and leisure and insurers, which led a market recovery in the recent weeks, fell between 2 per cent and 3.4 per cent.
Healthcare and technology stocks, which have taken a hit in the recent days, rose between 0.7 per cent and 0.1 per cent.
Wall Street’s S&P 500 and Dow Jones indices fell on Tuesday while the tech-heavy Nasdaq hit a record high for the third straight session.
The S&P 1500 airlines index tumbled 6.8 per cent, while cruise operators Carnival and Norwegian Cruise Line fell between 6.7 per cent and 6.2 per cent after leading the recent recovery in stock markets.
In a bright spot, Tiffany & Co edged 2.1 per cent higher as the luxury jeweller said it had amended certain of its debt agreements in order to have sufficient liquidity to navigate the virus outbreak as it posted a 43 per cent slump in quarterly sales.
– Additional reporting: Reuters