European shares finished the week on a positive note, spurred by a high global risk sentiment that was bolstered by a stream of information from the United States. The global financial community is now eagerly anticipating a forthcoming keynote speech from Jerome Powell, the Federal Reserve’s Chairperson, at the Jackson Hole event next week.
Despite apprehensions regarding an impending recession in the globe’s most robust economy, Thursday’s US sales data indicated a robust pattern of consumer spending.
In Dublin’s market, there was a slight decrease of 0.1 per cent as multiple high-traffic stocks experienced a decline. Among the declining shares were Ryanair, which fell 1 per cent to €14.83, and Kingspan, a producer of insulation material, which decreased by 0.5 per cent, closing at €81.70 following its latest results.
Banking stocks showed mixed results, with AIB shares falling by 0.5 per cent to €5.17, while the Bank of Ireland’s shares, on the other hand, recorded a slight increase of 0.2 per cent to finish at €10.12. Both banks had seen substantial gains the previous day. The stocks of Kerry and Cairn Homes saw a surge, with Kerry’s shares increasing by 0.6 per cent to €88.65, while Cairn Homes experienced a growth of 2.6 per cent to €1.89.
As for London’s FTSE 100, it showed subpar performance compared to its major European counterparts, marking a decline of 0.4 per cent following a 0.5 per cent rise in British retail sales for July. The positive sales data led to an increase in the value of the pound, resulting in a drop in the FTSE 100’s export-oriented shares. In contrast, the FTSE 250, primarily domestic, limited its losses to only 0.2 per cent.
The recent 0.5 per cent increase in retail sales met predictions, following a compromise in economic growth due to a weak June performance. This hinted that the pressure on UK consumers due to soaring inflation rates in 2022 and 2023, may be starting to alleviate.
Entain, the parent company of Ladbrokers, grew 2.7 per cent following an upgrade to ‘neutral’ from ‘sell’ by analysts at Goldman Sachs.
In Europe, the Stoxx 600 index closed the day with a 0.3 per cent increase, maintaining its two-week high while recording its best week since May 6. Over the week, the index rose 2.4 per cent. With a gain of 2.2 per cent, Italy’s FTSE MIB was the standout performer among its peers last Friday.
Boosted by rises in Ferrari and Stellantis, the car industry led the pack in gains for the day, appreciating by 1.2 per cent. Despite facing lawsuits from American shareholders over allegations of fraud, Stellantis managed a growth of 1.9 per cent, while Ferrari surged by 3.1 per cent.
Bayer, following a legal triumph in an attempt to restrain the liabilities from allegations that its Roundup weed killer is linked to cancer, saw a 10.4 per cent increase in value. UBS, meanwhile, rose 0.7 per cent on announcing plans to liquidate a €1.8 billion real estate fund it had acquired through purchasing Credit Suisse.
Talking about the New York market, positive vibes predominated at Wall Street with all major indices showing gains approximately at about 6pm GMT on Friday, as favourable economic data dispelled fears of a slowing economy, marking the best weekly performance for the US market this year.
S&P 500 and Nasdaq have almost retrieved their losses incurred over a ‘rout’, which thrust Nasdaq into correction territory fortnight ago, thanks to the better-than-expected data abating fears of a recession in the world’s premier economy.
However, following a strong pre-result surge, Applied Materials witnessed over 3 per cent plunge despite projecting slightly more than estimated revenues for its fourth quarter. US traded shares of packaging company, Amcor, also dipped by 6 per cent after its fourth quarter sales underwent more than anticipated decline due to reduced demand for its containers and boxes.
Shares of vaccine developers for mpox, Emergent BioSolutions and GeoVax Labs, experienced an upswing following reports of mpox cases outside Africa. Further updates were provided by Reuters/Bloomberg.