European shares remained steady on Thursday as financial speculators tamed their expectations regarding the speed at which the ECB would decrease interest rates during 2024, even though a reduction in June is almost assured. The pan-European Stoxx 600 index saw a mild increase of 0.07 per cent, as it shaved off its session peak.
Adversely, an encouraging earnings report from American microchip producer Nvidia lent a lift to technology sector stocks in markets globally.
Moving onto Dublin, the Iseq All-Share saw a slight increment of 0.7 percent, closing at 10,121.94. AIB experienced a rise of 0.6 percent to €5.18, driven by hopes that maintained higher official rates would support income. Conversely, Bank of Ireland experienced a minor slump of 0.9 per cent at €10.60, with the yearly general assembly failing to inject a new impetus into the company’s stock.
On the positive side, the small-sized Corre Energy noted an uplift of 3 percent reaching 47.4 cents post the energy storage developer raised €2.12 million from its founders and a key investor to tide it over in the short term while looking for larger investments.
Turning our focus to London, political ambiguity in the UK with a third subsequent downturn kept the primary domestic share indexes lower ahead of the impending elections in July. Lacklustre growth seen in businesses during May further affected the general outlook. The blue-chip FTSE 100 and mid-cap FTSE 250 each faced a fall of 0.4 percent.
An unanticipated call for a general election by UK prime minister Rishi Sunak alarmed traders as they assessed the potential outcomes. Utility shares plummeted by 7.1 per cent and energy infrastructure operator National Grid indicated potential sales of its Grain LNG terminal in Britain, causing its stock to nosedive by 10.9 per cent.
However, there was some optimism as well. The aerospace and defence sector witnessed a rise of 2.4 per cent, influenced by the Qinetiq Group’s financial robust outlook. Hargreaves Lansdown had a significant leap of 14.4 per cent following the rejection of a takeover bid.
An uptick in the technology index by 1.1 per cent was observed because semiconductor stocks such as ASML, Infineon, and ASM increased post-Nvidia’s announcement of a stock split and its quarterly revenue projection higher than estimations. Nvidia also hiked its quarterly dividend by 150 per cent on a post-split basis. Since late 2023, the technology sector’s outlook inspired by artificial intelligence (AI) prospects and rate cut expectations from the ECB have fuelled a rise in Stoxx 600 index. Despite nearing its record peak, it was cautious due to a hike in European bonds’ yields as euro-zone businesses reported highest expansion rate since a year ago, as per a preliminary survey.
Pay scale negotiations in quarter one showed a minor uptick, indicating caution in reducing interest rates from their all-time highs. By the end of 2024, traders anticipate ECB rate cuts amounting to 0.58 of a percentage point, compared to 0.67 of a point as of Wednesday.
A slide of 8.7 per cent in Embracer shares was reported following the resignation of the Swedish game developer’s CFO due to personal reasons. Its fourth-quarter operating profit closely matched the market predictions. Julius Baer shares rose by 3.2 per cent as the Swiss Bank’s managed assets grew by 10 per cent in the first four months of this year.
Investors hailed Nvidia’s revenue projections in New York, resulting in a climb in the Nasdaq, a tech-dominated index. However, inflation concerns in the United States restricted broader market advances. The Dow, a blue-chip index, suffered, becoming the worst performer among key indexes due to a dip in Boeing, which predicted negative free cash flow in 2024 due to a slow down in deliveries. Nonetheless, chip producers Broadcom and Micron Technology, along with AI server manufacturer Super Micro Computer, recorded a hike.
US conglomerate DuPont announced plans to split into three different publicly traded companies, leading to a marginal increase in shares. Meanwhile, Live Nation, the ticket sales powerhouse and parent company of Ticketmaster, fell following reports of possible dissolution by the US Department of Justice owing to its monopolistic grip on concert ticket sales. Additional information was provided by Reuters.