Europe’s benchmark stock index closed on a subdued note on Monday, as energy sector stocks fell on weak oil prices and offset gains in industrial stocks, while investors were on guard as they monitored developments in the Middle East.
The pan-European Stoxx 600 index ended up 0.1 percent. The industrial and automotive sectors rose 0.8 percent and 0.7 percent respectively, after the Ifo economic institute said German manufacturers were no longer seriously affected by shortages. materials, with the supply situation almost back to what it was before the Covid-19 pandemic.
Investors were on the lookout for any developments in the Middle East after Iran launched a retaliatory attack on Israel over the weekend, increasing the threat of a wider regional conflict. European defense stocks rose 0.8 percent, in line with their American counterparts.
“EU trade exposure to Iran is low… but continued escalation in geopolitical tensions will likely lead to more costly supply chain protection and thus higher oil prices,” they wrote Citi analysts.
DUBLIN
The Dublin Iseq rose slightly on the day to 9,898.35 in tandem with other European indices. It was a mixed bag in terms of individual stocks with AIB up 2.25 percent and Bank of Ireland down 0.8 percent. The third national banking force permanent TSB was up 3 percent.
Food giants Glanbie And Kerry Group were both lower as the sector pondered the prospect of interest rates in the United States and other countries remaining high for longer. Glanbie closed the session down 0.5 percent at €17.52 while Kerry was down 0.75 percent at €79.90. Ryanair trading flat at €20.28 in a context of continued volatility in oil prices linked to tensions in the Middle East.
EUROPE
Energy-related shocks have been a significant driver of inflation in Europe and globally. However, oil prices fell more than 1 percent as the market downplayed the risk of a broader regional conflagration after the Iranian attack, sending energy stocks down 1.5 percent.
To provide some relief, policymaker Gediminas Simkus said the ECB could make more than three rate cuts this year, while other officials including Olli Rehn, Peter Kazimir and François Villeroy de Galhau acknowledged the progress of the central bank in terms of inflation.
European stocks have posted a record rise since the end of 2023, driven by growing investor confidence in monetary policy easing this year and enthusiasm for artificial intelligence (AI).
Luxury giants including LVMH, Hermès And Richemont gained more than 1 percent each, with the luxury sector as a whole also rising 1 percent, after hitting a nearly two-month low on Friday. The earnings season is expected to accelerate with results from LVMH, Nokia, Ericsson and ASML expected throughout the week.
Among the key values, Temenos jumped 19.5 percent after a special committee appointed by the financial software company said claims made by Hindenburg Research were “inaccurate and misleading.” Adidas rose 4.2 percent after brokerage firm Morgan Stanley upgraded the German sportswear maker from “underweight” to “overweight.”
LONDON
UK stock markets lagged their international counterparts on Monday as the FTSE 100 index was dragged lower by mining companies and energy giants, in a reversal of Friday’s rally fueled by the industry. The FTSE 100 closed down 30.05 points, or 0.38 per cent, at 7,965.53.
This came after the blue-chip index was within a few points of hitting a new all-time high on Friday, amid a surge in gold and oil prices. But oil prices fell on Monday as investors continued to weigh the possibility of an escalation of conflict in the Middle East, following Iran’s missile and drone attack on Israel over the weekend.
In company news, shares in Thumb cap rose after the company announced it was selling its UK retail operations for around £346 million to US-based rival Group 1 Automotive.
Its boss said the “strategic importance of UK retail operations has become limited” due to the group’s international growth. Shares of the London-listed company were up 4.1 percent at the close.
Actions in Page group fell Monday afternoon after the recruiter revealed new business problems and further job cuts, with profits falling in recent months.
NEW YORK
The Dow outperformed its Wall Street peers on Monday, boosted by strong gains in Goldman Sachswhile rising Treasury yields following stronger-than-expected retail sales data helped contain gains. Goldman Sachs gained 3.1% after its first-quarter profit beat Wall Street estimates, fueled by a recovery in bond underwriting, trading and trading that lifted its earnings per share to the highest since late 2021. Apple fell 0.8 percent after data from research firm IDC showed the company’s smartphone shipments fell about 10 percent in the first quarter of 2024.
You’re here will lay off more than 10 percent of its global workforce, according to an internal memo seen by Reuters. Shares of the electric vehicle maker were last down 3 percent.
Selling power lost 5.5 percent after Reuters reported, citing a source, that the customer relations software maker was in advanced talks to acquire Informatica. – Additional reporting from Reuters
