Mixed bag for global equity markets as traders await economic stimulus
German Dax rises to six-week high as Iseq falls by almost a third of 1% on thin trading volumes
Traders work on the floor at the New York Stock Exchange in New York. Photograph: Brendan McDermid/Reuters
Wall Street’s main indices edged higher on Monday as investors bet on increased chances of monetary stimulus from central banks around the world to boost slowing growth.
European markets were mixed, with the German Dax rising to a six-week high as investors were more optimistic about Brexit, while other indices fell.
London markets all sank as FTSE stocks were weighed down by the strengthening pound, which was buoyed by a surprise return to GDP growth.
The Iseq fell by almost a third of 1 per cent on thin trading volumes.
It was a quiet day for the exchange’s heavy hitters, but Ryanair was among the strongest performers, finishing up 1.4 per cent to €9.69. The airline is exposed to Brexit and sterling, which strengthened on Monday, and is sensitive to any market sentiment that plays down No Deal.
Glenveagh Properties rose by 0.75 per cent to 69 cents per share. News emerged that its new chief executive, Stephen Garvey, had bought a sizeable tranche of shares in the business.
Glanbia was prominent among the significant fallers, down 2.7 per cent to close the session at €11.28.
The FTSE 100 closed 46.53 points lower at 7,235.81. British Airways and Aer Lingus owner IAG saw shares nudge lower after Monday’s flights were crippled as pilots launched a 48-hour strike in a dispute over pay. Members of the British Airline Pilots’ Association are staging their first industrial action against the airline, grounding hundreds of flights. Owner IAG saw shares slide by 6.6p to 423.5p as a result.
Elsewhere, Primark-owner Associated British Foods saw shares fall after it said it expects to see margins hit by Brexit-related cost rises. The finance boss at ABF said the company will take on the impact of a weak pound rather than pass price increases on to customers. Shares in ABF closed down 49p at 2,305p at the close of play
Shopping centre giant Intu has seen shares surge higher on the back of reports that a private equity buyer could snap up the retail property group. The company closed 3.82p higher at 40.32p on Monday.
The German Dax increased by 0.28 per cent while the French Cac moved 0.31 per cent lower. Banking-heavy indices in Milan and Madrid rose about 0.2 per cent, with Santander’s shares gaining 2.4 per cent after the Spanish bank said it would raise its ownership of its Mexican business to 91.65 per cent from 74.96 per cent after a stock exchange offer.
Automakers, meanwhile, jumped 2 per cent after upbeat German export data in July, while dimming chances of a no-deal Brexit helped Germany’s carmakers, whose key destination is Britain.
Shares of defensive sectors including healthcare, food and beverage and utilities, which have enjoyed a strong run-up this year, fell about 1.7 per cent, weighing on the STOXX 600.
Shares in Air France slid 10 per cent to the bottom of the index after disappointing August numbers.
A rise in US treasury yields, with those on 10-year notes climbing to three-week peaks, led investors to switch from bonds to riskier assets. Big lenders, including Goldman Sachs, were among the biggest beneficiaries. Financial stocks rose 1.39 per cent, the biggest boost among the 11 major S&P sectors with banks gaining 2.67 per cent.
AT&T gained 2.66 per cent after shareholder Elliott Management Corp disclosed a $3.2 billion (€2.9 billion) stake in the company and pushed for changes.
Boeing fell 1.1 per cent after it suspended load testing of its new wide-body 777X aircraft over the weekend as media reports said a cargo door failed in a ground stress test.
Amgen fell 3 per cent after analysts raised questions about data on the company’s lung cancer drug, dragging the healthcare sector down 1.14 per cent.
Shares of Fred’s plunged 46.27 per cent to a record low after the discount retailer said it filed for Chapter 11 bankruptcy protection.
– (Additional reporting: PA/Reuters)