Middle East sanctions trouble stock markets

Irish shares outperformed European peers yesterday as markets were hit by trade jitters and rising tensions over Middle East sanctions.

In the US, investors focused on speeches by Federal Reserve officials for clues on monetary policy while in the UK, the FTSE 100 eked out modest gains on the back of strength in mining companies and oil stocks.

DUBLIN

The Iseq all-share index improved 0.65 per cent on Tuesday buoyed by strong moves in banks and property names. But it was Smurfit Kappa which lead the gainers on the smaller Iseq 20 index. The company posted a 3.88 per cent rise in its share price to €26.75.

While Bank of Ireland rose 2.94 per cent to €4.55, its rival AIB was among the losers, falling 1.09 per cent to €3.45. That list was led by Dalata, which dropped 3.69 per cent to €4.70.

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Green Reit, the property company up for sale, saw an unusually high trading volume on the day, with about 12.9 million shares changing hands. The company rose 0.67 per cent to €1.80.

Residential housebuilder Glenveagh Properties also posted a decent trading volume. But the 3.9 million shares traded led it 1.54 per cent lower to €0.70 a share.

LONDON

The FTSE 100 erased earlier losses to edge 0.1 per cent higher, while the mid-cap FTSE 250 lost 0.1 per cent. Shares of heavyweight miners rose after a strike at a major mine in top copper producer Chile highlighted supply constraints, while oil companies advanced in anticipation of a bullish reading of US crude stock data.

Sales at British supermarket chains fell during the 12 weeks to June 16th, losing further ground to discounters Aldi and Lidl, industry data showed, leading shares of Tesco and Morrisons 1 per cent lower.

On the mid-cap index, Petrofac tumbled 6.5 per cent after the oilfield services provider, dogged by legal challenges over the last two years, said its business was hit by challenges in Saudi Arabia and Iraq.

Rail operator Stagecoach gave up 6.6 per cent ahead of its annual results yesterday.

EUROPE

The pan-European Stoxx 600 index dipped 0.1 per cent in thin trade with most of the Europe’s country indexes in the red.

Losses on the index stemmed mainly from the retail, auto and banking sectors. Renault shares slipped 2 per cent. Nissan Motor smashed hopes for a quick fix to strained relations with Renault, saying inequality between the partners could unravel their two-decade-old carmaking alliance.

Shares of France's Carrefour retreated a day after it became the latest Western retailer to retreat from the Chinese market.

NEW YORK

Wall Street stock indexes fell yesterday, led by a sharp sell-off in technology shares, as simmering trade concerns and disappointing economic data sent buyers to the sidelines, while the Federal Reserve chairman Jerome Powell pushed back on pressure from US president Donald Trump to cut interest rates.

All three major US stock indices ended the session in the red after Mr Powell said the Fed was grappling with whether trade uncertainties and other issues warrant rate cuts.

Speaking at the Council on Foreign relations, Powell also reiterated the Fed’s independence, a day after Trump tweeted that the Fed “doesn’t know what it’s doing”.

On the economic front, new home sales and consumer confidence numbers both came in well below economist expectations, according to separate reports from the US Commerce Department and the Conference Board.

The Dow fell 179.32 points, or 0.67 per cent, to 26,548.22, the S&P 500 lost 27.97 points, or 0.95 per cent, to 2,917.38 and the Nasdaq dropped 120.98 points, or 1.51 per cent, to 7,884.72. – Additional reporting: Reuters