On Tuesday, global shares and bonds experienced a downward dip due to firm economic indicators and a surge in commodities, which fuelled suspicions that key monetary institutions will maintain elevated rates for a longer duration.
Euronext Dublin was no exception, ending the day 0.6 percent lower, a fall in line with its global counterparts. The probability of sustained higher rates was perceived positively for banking institutions, pushing the AIB upward by 1.4 percent. Conversely, the Bank of Ireland saw a marginal decline of 0.9 percent.
In relation to commodities, oil values momentarily exceeded $89 (£66) a barrel, a first since October. This subsequently resulted in a decline in the travel industry’s shares. For instance, Ryanair saw a 2.4 percent slump, while Dalata, the largest hotel conglomerate in the country, experienced a 5 percent fall by end of the business day.
However, there were recipients of good news too. Despite economy trends, Irish Continental Group, owner of Irish Ferries, managed to defy the trend, winding up 3 percent higher. “The demand for Irish Continental Group remains robust, and in fact, it concluded at €5, a fairly substantial amount,” one dealer observed.
Moving to the London market, the FTSE 100 seemingly moved towards an all-time high before receding later in the day. The index momentarily reached an impressive 8,015.63, the best performance since February 2023, and was marginally short of its record by around 31 points. However, the index’s good fortune didn’t last, and it eventually declined by 17.53 points or 0.22 percent, settling at 7935.09. The descent was primarily driven by Reckitt and Entain, both of whom lost around 5 percent of their value.
In terms of corporate news, there was little to report. However, Superdry suffered a drastic drop of over 55 percent in shares following revelations made after market closure last week. The declaration confirmed that CEO Julian Dunkerton won’t be launching a bid to acquire the company, despite previously being associated with a potential takeover.
Trading of Revolution Bars’ shares were temporarily halted as the company was unable to announce its results in a timely manner. The reason for the delay wasn’t clarified but it was stated that the results would be published in good time.
In Europe, the stock market faced a downturn, mirroring the steep decline in US stocks, as market players reassessed the trajectory of interest rates. The Stoxx Europe 600 index experienced a reduction of 0.8 per cent. At the same time, Frankfurt’s Dax index and Paris’ Cac 40 index saw a decrease of 1.09 per cent and 0.92 per cent respectively. Despite the recent fall, European stocks have just completed their most successful quarter in a year, driven by a positive economic outlook and hopes of interest rates reducing in the near future.
Across the Atlantic, the main stock exchange indices in Wall Street were on the decline too, adversely affected by a surge in treasury yields and a dip in Tesla’s fortunes following weaker than expected first-quarter deliveries, contributing to a 5 per cent fall in the automaker’s shares. This was close on the heels of robust economic indicators leading to doubts regarding the timing of potential rate cuts by the Federal Reserve.
Equities related to the growth of Nvidia, Microsoft, and Amazon experienced a slump ranging between 0.7 per cent and 1.4 per cent, accompanying a sharp increase to 4.365 per cent in the US treasury 10-year yield, a high for the year. Furthermore, shares by UnitedHealth, CVS Health and Humana, all dropped by between 7.5 per cent and 14.1 per cent, following an unchanged reimbursement rate for Medicare Advantage plan providers, hitting insurers hard.
By 11.56am eastern time, the Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite had gone down by 1.19 per cent, 1 per cent and 1.32 per cent respectively.