Iseq underperforms as quarantine possibility stalls travel stocks

Trading subdued across Europe due to US shutdown for Martin Luther King jnr Day

In Dublin,  shares of Ryanair fell 3.1 per cent to close at €15.30. Photograph: Andy Rain/EPA

In Dublin, shares of Ryanair fell 3.1 per cent to close at €15.30. Photograph: Andy Rain/EPA

 

European stocks rose on Monday as a jump in carmaker Stellantis and luxury stocks helped reverse early market losses due to worries about an economic recovery. US stock markets were closed for Martin Luther King jnr Day.

Dublin

The Iseq lagged its peers and shed just over 1 per cent on thin trading volumes, as trading markets everywhere was subdued due to the US shutdown.

Travel and tourism related stocks fared poorly, as the rumours from Government suggested that the State is moving closer to imposing travel quarantine restrictions to fight the coronavirus.

Dalata, the largest Irish hotel group, dropped by 2.4 per cent to reach €3.43. Irish Continental Group, the owner of Irish Ferries, fell by 2.2 per cent to finish the session at €4.31 per share. Meanwhile, Ryanair, which faces a bumpy ride in the short term as Europe struggles to contain the latest upsurge, fell 3.1 per cent to close at €15.30.

General insurer FBD Holdings dropped by 1.6 per cent to €7.26, on a read through from a recent UK court decision on pandemic-related business interruption cover. Davy stockbrokers said the UK ruling, if it was ever repeated in Ireland, could lead to higher gross losses for FBD.

London

The FTSE 100 slipped, weighed down by falls in energy and travel stocks, while tighter restrictions on businesses led to concerns about the near-term impact on the economy. The index fell 0.2 per cent, while the domestically-focussed mid-cap FTSE 250 index rose 0.1 per cent.

Energy majors BP and Royal Dutch Shell were the biggest drag on the main index as oil prices slid on fears over soaring Covid-19 cases around the world and the slow pace of vaccinations against the virus.

Travel and leisure stocks, including British Airways-owner IAG, EasyJet and Intercontinental Hotels , shed between 0.8 per cent and 1.9 per cent as all travellers to Britain must have a recent negative Covid-19 test and be prepared to quarantine at home for 10 days on arrival.

Drugmaker AstraZeneca rose 0.9 per cent after saying its breast cancer drug received approval as a treatment for a certain type of advanced gastric cancer in the US.

Energy services company Centrica lost 2.2 per cent after it said its chief financial officer, Johnathan Ford, would step down on January 31st.

Animal genetics firm Genus saw its shares jump to an all-time high after it raised its profit outlook on the back of strong demand for pig and bull semen. Shares in the company moved 180p higher to 4,492p after it said its pig division was buoyed by strong demand in China from pork producers looking to grow herds following the impact of African swine fever.

Europe

The pan-European Stoxx 600 index closed 0.2 per cent higher after see-sawing through the session. The German Dax rose 0.4 per cent, boosted by a 4.8 per cent jump in Adidas, while UK’s FTSE 100 slipped 0.2 per cent and France’s CAC 40 rose just 0.1 per cent.

Luxury stocks including Richemont and LVMH were among the top boosts to the Stoxx 600 after bullish brokerage calls.

Italian stocks outperformed as shares in Stellantis jumped 7.6 per cent in their first day of trading on the completion of the $52 billion merger between Fiat Chrysler and PSA. Its shares rose 6.9 per cent in Paris markets.

M&A also drove big swings in stocks. Carrefour slid 6.9 per cent after a possible takeover for €16.2 billion by Canadian rival Alimentation Couche-Tard unravelled over the weekend. The stock erased almost all its gains since the deal was announced last week, with the French government opposing the deal, citing food-security concerns.

French waste and water management company Suez, which is fighting a takeover approach from arch-rival Veolia, rose 3.2 per cent after it said it had received an alternative proposal from investment firms Ardian and Global Infrastructure Partners. Shares in Veolia fell 1.8 per cent. – (Additional reporting: Reuters/PA)