Global markets rose on Thursday after the US Federal Reserve slashed interest rates by 0.5 percentage points and set the scene for a series of rate cuts to follow.
Dublin
Euronext Dublin, as the Irish Stock Exchange is known, rose 2.2 per cent.
The Irish banks were up on the day. Bank of Ireland rose 3.7 per cent to €10.37 a share, while AIB was up 1.48 per cent to €5.48. Kingspan was up 4.44 per cent to €84.65, coming as the company announced the purchase of Texas-based firm IB Roof Systems for an undisclosed amount.
Ryanair finished up 3.54 per cent at €16.67, Michael O’Leary saying in recent days that discounting of airline fares might not be as severe as expected.
Building companies had a good day, with Cairn Homes rising 2.38 per cent to €1.90 and Glenveagh Properties up just over 1 per cent to €1.55 a share.
London
The UK’s benchmark stock indexes ended higher on Thursday after the Bank of England kept rates on hold, as widely expected, and extended its bond-reduction plan for another year. The blue-chip FTSE 100 was up 0.9 per cent, while the mid-caps gained 1.6 per cent. Both indexes touched their highest levels in over two weeks.
Bank of England policymakers voted 8-1 to keep benchmark rates on hold at 5 per cent, though governor Andrew Bailey said cooling inflation pressure meant the Bank of England should be able to cut interest rates gradually over the months ahead.
Among individual stocks online grocer Ocado advanced 2.8 per cent after Ocado Retail lifted its forecast for 2023-2024. S4 Capital fell 5.9 per cent after the ad group downgraded its revenue forecast on weakness in demand from its tech clients.
Europe
European stocks jumped, continuing the positive reaction to the US Federal Reserve delivering a 0.5 per cent rate cut and flagged that further easing would be measured, raising hopes of a soft landing for the American economy.
The Stoxx 600 index closed 1.4 per cent up, its highest closing level in more than two weeks.
Most local bourses also clocked sharp gains, with Germany’s blue-chip benchmark jumping 1.6 per cent, an all-time closing high.
Growth-sensitive technology stocks jumped 3.5 per cent in tandem with tech giants on Wall Street, while miners added 3 per cent after prices of most base metals rose with the long-awaited Fed rate cut and weakened the dollar.
Utilities and telecoms lagged with a more than a 1 per cent fall in each.
Following the Fed’s move analysts also wondered how the European Central Bank would proceed after it had opted to cut rates by 0.25 per cent in June and September.
New York
Wall Street rallied, with the S&P 500 hitting another midday record high after the Federal Reserve kicked off its easing cycle with a half-a-percentage point reduction and forecast more cuts were on the horizon.
Rate-sensitive growth stocks that have led much of this year’s rally rose. Microsoft added 2 per cent, Tesla gained 4.2 per cent, and Apple advanced 2.6 per cent.
Semiconductor stocks such as Nvidia rose 4.7 per cent, while Advanced Micro Devices gained 3.5 per cent and Broadcom added 3.8 per cent, sending the Philadelphia SE Semiconductor Index up 3.6 per cent.
The Russell 2000 index also rose 1.7 per cent with the broader market as a lower interest environment could mean lower operating costs and greater profits for credit-dependent companies. – Additional reporting: Agencies
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