Shares stutter as hopes for post-Covid recovery diminish

Dampened hopes of a post-Covid recovery halted a rally in European shares yesterday, while investors waited for US legislators to approve a $1.9 trillion boost for the world’s biggest economy.

Dublin

Ryanair Holdings fell 3.64 per cent to €15.07 as the UK government imposed new restrictions and observers suggested that a recovery in European travel could be delayed a few months. The stock traded as high as €15.70 during the day.

International packaging group Smurfit Kappa shed 1 per cent to €40.26 ahead of the publication of annual results on Wednesday. Its shares traded between €39.32 and €40.60 over the course of the day.

Insulation specialist Kingspan's stock fell 2.82 per cent to €55.15 as an inquiry into a fire in a tower block in Grenfell in London prompted more damaging revelations about the Irish company's UK business in 2008.

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AIB added 2.33 per cent to €1.668 while Bank of Ireland nudged up 0.6 per cent to €3.368. Traders said an increase in bond rates boosted the Irish lenders.

London

Aer Lingus owner International Airlines Group fell 3.3 per cent to 153.9 pence sterling as the UK government indicated that it could impose quarantines on travellers from countries with fast-spreading Covid variants.

Homebuilder Bellway rose 3 per cent to 3,120p after it reported strong demand for new homes, as low lending rates and a temporary cut in stamp duty boosted activity in the sector.

Its bigger rivals Barratt and Taylor Wimpey also gained ground. Barratt edged up 0.37 per cent to 697.6p. Taylor Wimpey climbed 2.6 per cent to 165.9p.

Online supermarket Ocado Group fell 1.7 per cent to 2,700p and was one of the top drags on the blue-chip FTSE 100, even as the group reported a 69 per cent increase in 2019-2020 earnings.

Europe

Energy major Total fell 1.8 per cent to €34.56 after rising up to 2.8 per cent. It posted better-than-expected earnings in the fourth quarter, although a hit from writedowns on assets due to the pandemic landed it with a $7.2 billion net loss for 2020.

Germany's DAX index was down 0.3 per cent even as data showed the country's exports rose in December as robust trade with China and the US helped.

Danish hearing-aid maker Demant topped the Europe-wide Stoxx 600 index after saying it expects to return to strong growth in 2021 as Covid-19 lockdowns are lifted. Its shares closed 11.75 per cent up at 262.4 kroner.

German-British holiday giant TUI Group fell 3.9 per cent to €3.63, a two-month low, as it reported a first-quarter loss of €699 million.

Shares in Swiss chemicals and biotechnology group Lonza rose 3.1 per cent to 587.8 francs on a $4.7 billion deal to sell its speciality ingredients division to Bain Capital and Cinven.

New York

The Dow and the S&P 500 pulled back slightly on Tuesday after a six-day run, with investors closely tracking progress in passing a proposed $1.9 trillion stimulus plan. The tech-heavy Nasdaq, on the other hand, hit an all-time high for the fifth consecutive session, supported by gains in Apple and Netflix.

Largely upbeat corporate earnings so far, along with monetary and fiscal support, have powered the major US stock indices to record highs but analysts have cautioned against risks from new coronavirus variants and any glitches in vaccine rollouts.

Toymaker Mattel rose about 1 per cent, while telephone equipment maker Cisco Systems slipped 0.8 per cent ahead of their earnings after market close.

Gucci lipstick maker Coty tumbled 17 per cent as weak demand for makeup amid global Covid lockdowns wiped off millions off its quarterly revenue.

Take-Two Interactive Software fell about 6 per cent after the video-game publisher posted a drop in quarterly adjusted sales and shied away from announcing any new big releases.

Bitcoin fast approached the $50,000-mark as the afterglow of Elon Musk-led Tesla's investment in the cryptocurrency had investors reckoning it.

Additional reporting - Reuters