US-China tariffs delay cheers investors

In Dublin, the Iseq index ended the session in the black, but lagged its European peers with an increase of just 0.15%

Traders work on the floor at the New York Stock Exchange. Photograph: REUTERS/Brendan McDermid

Traders work on the floor at the New York Stock Exchange. Photograph: REUTERS/Brendan McDermid

 

European shares staged a comeback from early losses on Tuesday as growth sectors led the charge, after a US move to delay tariffs on some Chinese goods provided a lift to battered global sentiment. Shares also rose in the United Kingdom and United States, as markets roiled by the trade dispute breathed a sigh of relief.

Dublin

The Iseq ended the session in the black, but only just, lagging its European peers with an increase of just 0.15 per cent.

Some companies with links to the property industry fared poorly. IRES Reit fell more than 2.5 per cent to €1.63 per share, while Hibernia Reit dropped by 1.8 per cent to €1.39.

Dalata, the largest Irish hotel group, fell by 1 per cent to €4.70. The company has extensive Irish property holdings, but sentiment in its sector was also affected by the news that the airline Norwegian is culling its transatlantic flights from Ireland, potentially affecting US tourist numbers.

IFG Group rose 5.2 per cent to €2.02 after UK financial authorities cleared a takeover backed by private equity firm Epiris.

London

The FTSE 100, which had started off the session in the red amid Hong Kong protests and the US-China trade worries, ended 0.3 per cent higher. The midcap index rose 0.5 per cent.

Plus500 surged 21 per cent, erasing a third of its year-to-date losses, after its new share buyback plan offset a more than 50 per cent slump in first-half earnings.

Luxury carmaker Aston Martin, on the other hand, lost 4 per cent after Credit Suisse downgraded its rating and slashed its price target by more than two-thirds. A Financial Times report also said hedge funds had taken short positions in the company.

Blue-chip retailers Next, Marks & Spencer and Tesco lost 1.2-2 per cent a day after data showed 10.3 per cent of shops in Britain were vacant, the highest rate in four years. More than 50 retailers, including Sainsbury’s and M&S, have urged the government to freeze business rates to help out the struggling sector.

London-listed shares of tour operator TUI, which earlier rose as much as 4.4 per cent, ended the day slightly lower after reporting a 46 per cent decline in core earnings amid problems with the grounding of Boeing’s 737 MAX jets in the third quarter.

Europe

Commodity stocks, automakers and tech sectors were among the biggest gainers in Europe, and helped the pan-European STOXX 600 index close up 0.5 per cent, erasing session losses of up to about 0.8 per cent.

Export-reliant Germany’s DAX rose 0.6 per cent on the US news, recovering after data showed plunging economic sentiment among German investors. Investors will be closely watching Wednesday’s second-quarter economic growth data to see if Europe’s biggest economy is headed for recession.

Italian shares, troubled by political turmoil, rose more than 1 per cent as banks rose with Monte Dei Paschi up 7.2 per cent.

In corporate news Henkel shares slid to the bottom of the pan-region index after the German consumer goods company lowered its full-year outlook for sales and earnings.

New York

US stocks surged more than 1.5 per cent on Tuesday after the Trump administration said it would delay 10 per cent tariffs on some Chinese products, including laptops and cell phones.

A 4.1 per cent jump in shares of Apple, which makes iPhones and MacBooks in China, along with a rise in chip stocks pushed the technology sector 2.38 per cent higher. The Philadelphia chip index rose 3.04 per cent.

Industrial bellwethers 3M and Caterpillar, traditionally among the most sensitive to trade concerns and China, jumped about 3 per cent each, while the S&P 500 retailing index gained 2 per cent.

Wall Street’s main indexes opened lower, adding to a global slide in stocks due to geopolitical concerns, with a US labour department report showing that the core consumer price index rose 2.2 per cent in the 12 months through July.

– (Additional reporting: Reuters)