European shares have seen an increase for three consecutive sessions, buoyed by robust worldwide economic figures and forecasts that the US Federal Reserve could cut interest rates in the upcoming month. The European Stock 600 Index saw a 1% rise, despite certain analysts warning investors about being overly confident. Shares in insurance and technology sectors triumphed, but travel and leisure, alongside retail, didn’t perform as well.
There has been a bounce-back in the stock market following a dismal August beginning, as solid economic statistics alleviate fears regarding an American recession. Data revealed a slowing down of US inflation mid-week, which was then followed by favourable figures from the economies of Japan and China. Ulrich Urbahn, Berenberg’s multi-asset strategy and research head, remains carefully optimistic downplaying fears of a US recession, and advocated for increased investment in shares during the previous week’s market dip.
Current speculation predicts approximately 100 basis point rate cuts by the Fed by this year’s end, as interpreted by swaps data.
DUBLIN
Financial sector had a good day with both AIB and Bank of Ireland seeing a rise, with the latter’s competitors reported increases of 3.4% and 5.7% respectively. This took place after reports that suggested a future sale of state-owned shares in AIB will not necessitate a re-examination of the salary cap for senior personnel. Notwithstanding bad sentiment for the travel industry, Iseq heavyweight Ryanair saw a 1.3% rise. Mining group Kenmare’s shares saw a healthy 5% rise following Tom Hickey’s ascension as the new chief officer.
LONDON
Thursday saw a surge in London’s FTSE 100, although its performance was dwarfed by its global counterparts as worldwide stock markets saw an overall rise. The blue-chip index closed up by 66.3 points, or 0.8%, at 8,347 with financial and banking companies showing the most significant increases.
Stocks of Rank Group, owners of Mecca Bingo, saw a jump in response to the company’s return to pre-tax profitability this past year, following a period of financial hardship due to Covid and cost-of-living crunches. The company announced its recovery and return to profitability with much celebration.
Insurance giant Admiral ascended to the pinnacle of the FTSE 100 on the back of skyrocketing profits for the first half of the year. This can be attributed to an impressive 12% rise in customer base, culminating in figures exceeding 10.5 million, as well as robust earnings and revenues.
Europe saw further growth in its major share indexes this Thursday. The Dax index in Frankfurt rose by 1.66%, while the Cac 40 in Paris closed at a higher rate of 1.23%. The banking, retail, and automotive sectors registered strong performances, although gains were recorded in most sectors. Dutch payment firm Adyen was the best performing entity, with a 12% surge in its shares following a better-than-expected half-year core profit. However, Swedish gaming firm Embracer suffered a more than 7% decline following a first-quarter operating profit plummet of 50%.
Across the pond in New York, key indexes on Wall Street observed an approximate 1% increase as solid retail data for July suggested sustained consumer expenditure, reducing concerns of a potential recession in the world’s largest economy. Growth and large-cap stocks trended upwards, with Tesla leading by a hike of 4.1%.
Retail industry trendsetter, Walmart, saw a 7.5% incline after its annual profit forecast was revised upward for the second time this year, with American shoppers continuing to favour their low-priced essentials. Rival entity, Target, also notched up a 4.8% rise, and Costco climbed by 2%.
In other activity, Cisco Systems spiked by 9.4% following higher than anticipated revenue forecasts for the first quarter and a global workforce cut by 7%. Sports apparel company, Nike, rose 3.3% following significant stake purchase by billionaire William Ackman, and Ulta Beauty saw a surge of 10.4% as Warren Buffet’s Berkshire Hathway acquired a stake in the company.