Ryanair surges while Penneys owner the biggest faller on the FTSE
European shares edge higher as cyclicals back in favour, food stocks up in Dublin
Ryanair shares climbed as the airline made progress in dealing with its industrial relations issues. Photograph: PA
World equity markets dipped on Thursday, pausing after a string of record highs, while a decline in oil prices dragged on energy shares and the US stock market.
In Europe, shares notched up modest gains, led higher by a fresh rise for so-called cyclical stocks while company updates and ratings changes from brokers spurred moves among individual names.
Ryanair shares enjoyed a resurgence as the airline said pilots at each of its 15 UK bases, including its largest company-wide base at London Stansted, had accepted pay increases of up to 20 per cent that many had previously rejected.
The airline shares were 3.2 per cent higher at €16.61 after the announcement was made, with the company adding it was disappointed that a vote was not organised in Dublin to accept the pay increases. Shares in the airline closed up 2.7 per cent to €16.53.
Food stocks were big movers on Thursday with the likes of Glanbia, Kerry, Greencore and Aryzta all rising.
Swiss-Irish baked goods group Aryzta, which last week announced a new chief executive for its North American business, closed up 3.89 per cent to €31.74. Glanbia gained 5 per cent to €14.17, while Kerry Group edged up 0.3 per cent to €89.79 having traded higher earlier in the day. Greencore was up 1 per cent higher in London.
Iseq heavyweight CRH was among the fallers, down 1.2 per cent to €29.74 while banks were flat outside of Permanent TSB, which closed 2.3 per cent higher at €2.40.
Britain’s blue-chip index fell on Thursday, led lower by utilities and a decline for Associated British Foods after warning that profit at its sugar business would fall more than previously forecast. The FTSE ended 0.3 per cent down at 7,700.96 points and the mid-cap index finished with a 0.5 per cent fall.
SSE was among the biggest FTSE fallers, sliding 3.1 per cent as the stock traded ex-dividend. Elsewhere in the sector National Grid fell 1.5 per cent, Severn Trent retreated 0.1 per cent and Centrica 1 per cent.
Penneys/Primark owner AB Foods was the biggest FTSE faller overall however, dropping 3.6 per cent. The company maintained full-year earnings guidance on Thursday but said that revenue and profit at its sugar business would fall by more than previously expected because of lower European Union sugar prices.
Whitbread advanced 3.5 per cent as prospects of a break-up of the company more than offset disappointment over a drop in sales for its Costa Coffee business in a tough British retail market.
Switzerland’s Geberit posted the best performance among European stocks, with a 6.5 per cent rise after reporting a 3.5 per cent increase in 2017 sales.
In France, Carrefour was among the top performers on the CAC 40 with a 3 per cent rise, with traders saying stronger-than-expected fourth quarter sales from the supermarket chain had offset the negative impact of a new profit forecast cut.
In Frankfurt, German chipmaker Infineon led the DAX higher, adding 5.6 per cent after getting a rating upgrade from Goldman Sachs, while SocGen began its coverage of the stock with a “buy” rating.
Wall Street’s main indexes edged lower in early trading on Thursday as declines in healthcare and energy stocks paused a rally that had driven the Dow Jones index to its fastest ever 1,000 point gain. Merck and Pfizer weighed the most on the S&P healthcare sector, which fell 0.45 per cent.
Alcoa shares sank 8 per cent after the aluminium producer’s quarterly earnings missed analysts’ estimates.
Amazon said it has short-listed 20 cities, including one in Canada, to build its second headquarters after reviewing 238 proposals and expects to make a decision this year. Its shares rose 0.35 per cent.
Bank of New York Mellon fell about 5 per cent after the custodian bank said it expected to book more in severance costs in 2018.
– Additional reporting: Agencies