Travel and leisure stocks slide after attack in Nice

European stocks stabilised late on Friday after a further bout of volatility sparked by the attack in Nice in the south of France. Travel and leisure stocks slid furthest, with investors fearing that the violence would hit tourism.

However, towards the close of business, markets recovered some of the ground lost in earlier trade.

DUBLIN

The Irish market gave up ground, with traders saying that activity in what had been a lacklustre week “fizzled out”.

Ryanair ended the day down 2.32 per cent at €11.59. Dealers noted that one trade of 3.25 million shares in the low-cost airline went through at €11.57. Overall, close to seven million of its stock changed hands in Dublin on Friday.

The fall in its share price reflected the overall weakness in the sector following the attack in France. The airline is due to report quarterly results on July 25th.

In an assessment of the airline industry published on Friday, analysts Stephen Furlong and Ross Harvey of Dublin firm Davy said that they expected Ryanair to stick with its full-year profit forecasts of €1.375 billion to €1.425 billion.

By contrast, ferry company Irish Continental Group, whose stock has suffered in the wake of the Brexit vote, climbed 1.08 per cent to close at €4.67. Dealers said it was one of the few bright spots on the market and suggested that its shares had been over sold in the wake of the referendum.

CRH, another stock with an impact on the Irish index, slid 1.24 per cent to €26.25. Investors sold around 1.55 million of its stock on Friday.

Paddy Power Betfair was down 1.16 per cent at €102.40. Smurfit Kappa dipped 0.34 per cent to €20.46.

LONDON

Shares in Irish energy and transport group DCC rose 0.3 per cent to 6,690 pence sterling after saying that operating profit in its first quarter was significantly higher than during the same period in 2015.

It also predicted that the weakened pound sterling would further boost profit. It reports in the British currency and generates half its earnings outside the UK.

Aer Lingus owner, International Airlines Group tumbled 3.9 per cent to 422.10 pence. Budget airline easyJet was down 2.6 per cent, joined by cruise company Carnival, which fell 2.3 per cent. TUI was down 1.1 per cent.

EUROPE

Swatch Group tumbled 7.8 per cent after weak demand for its watches in Hong Kong, France and Switzerland led to an earnings plunge. The stock fell as much as 14 per cent at one point as the Swiss maker of Omega and Tissot timepieces said earnings slid 50 to 60 per cent. Analysts had expected a 22 per cent drop in net income.

Its slide had a knock-on effect on rival Richemont, maker of Cartier watches, whose shares dropped 3.1 per cent.

Swedish Orphan Biovitrum climbed 7.6 per cent after reporting quarterly earnings and sales that beat estimates.

French hotels operator Accor, Europe's largest hotel group, fell 3 per cent, while shares in airlines such as Air France-KLM also slipped.

The pan-European Stoxx 600 index, which tracks leading stocks in 18 markets, ended down 0.2 per cent. France's CAC equity index was down by 0.3 per cent. The Stoxx Europe 600 Travel & Leisure index dropped by around 1.2 per cent.

NEW YORK

A rally that pushed the S&P 500 to record highs every day this week ran out of steam on Friday, with financials leading Wall Street lower.

Citi’s second-quarter profit fell 14 per cent, but was less than expected, while Wells Fargo’s profit fell in line with expectations. Still Citi shares were off 0.8 per cent, while Wells Fargo’s dropped 3 per cent.

Following news of the attack in Nice, travel operators and airlines dropped on fears about travel to Europe. Priceline fell 1.5 per cent to $1326.16, while Delta Air Lines fell 2 per cent.

– (Additional reporting: Bloomberg, Reuters)