The Iseq ended Wednesday with a 0.48 per cent decrease, mirroring the performance of other European markets. The American markets demonstrated a lethargic response as Boeing reported a quarterly deficit of €5.6 billion ($6 billion), pushing the company’s total losses for the current year to almost €7.5 billion.
In Dublin, the Iseq followed suit. Kingspan’s stock declined by 2.07 per cent, closing at €80.55 per share, while Ryanair experienced a marginal increase of 0.11 per cent, closing at €17.72. Dalata Hotels’ shares remained unchanged at €4.29. In the banking sector, AIB shares fell by 0.33 per cent to finish at €4.90, whereas Bank of Ireland saw a gain of 0.86 per cent, ending at €8.91 a share. The shares of Kerry Group and Glanbia decreased by 0.75 per cent and 1.61 per cent, closing at €92.80 and €15.85 respectively. Meanwhile, housebuilders Cairn Homes and Glenveagh Properties recorded a drop of 1.16 per cent and 1.48 per cent, ending at €2.13 and €1.60 per share, respectively.
Over in London, the city’s primary stock index, the FTSE 100, along with the domestically focused FTSE 250 both fell by 0.6 per cent. The anticipation of the UK budget and US presidential election induced a timid approach from investors towards riskier assets. Industrial and precious metal miners shares declined by 1.6 per cent and 1.4 per cent respectively as the value of copper and gold fell against a rising dollar. The financial markets are awaiting the next Bank of England meeting, fully expecting an interest rate cut in November and a probable further cut in December.
Across Europe, trading performance was patchy with shares closing in the negative territory, particularly among mining stocks. Poor earnings reports from major players like Deutsche Bank, Germany’s leading bank, and beauty behemoth L’Oreal further dampened investor sentiment.
The STOXX 600, a European index, experienced a drop of 0.3 per cent, mirroring the downward movements of major markets in Germany, France, and Italy. The basic resources sector suffered the largest hit with a decrease of 1.4 per cent, precipitated by a drop of 2.3 per cent in Boliden, a Swedish company, due to a UBS rating downgrade from “neutral” to “sell”.
A major focus was on corporate earnings, specifically Deutsche Bank, which saw a 2 per cent decrease in their shares. This was due to an increased prediction of bad loans, in light of Germany’s faltering economy, marring the bank’s return to profitability in the third quarter.
Philip Lane, chief economist at the European Central Bank, flagged concerns about the euro zone’s economic recovery, following a series of underwhelming data. The fear is that the stagnant economic growth within the monetary union could negatively impact corporate performance this quarter. The Stoxx 600 index has seen little advancement since its initial mid-May levels.
In the US, the S&P 500 tumbled by 0.7 per cent, the Nasdaq 100 lost 1 per cent and the Dow Jones Industrial Average was down by 0.9 per cent. Boeing’s shares took a plunge as the company signaled ongoing challenges, bolstered by its chief executive, Kelly Ortberg’s call for significant cultural change amid gaping quarterly losses of $6 billion due to a workers’ strike.
Existing home sales in the US plummeted to their lowest in nearly 14 years in September, as potential buyers hold out for lower mortgage rates and more favourable asking prices. For the bond market, expectations of Federal rate cuts within the upcoming year are being pared back; however, clarity is anticipated with the October labour market report expected next week.