Business

Stocks edge lower as investors weigh geopolitical tensions

Irish market outperforms its European peers as banks nudge higher

The UK’s FTSE 100 share index dipped on Wednesday, as hotter-than-expected inflation data tempered expectations for quick interest rate cuts, and overshadowed optimism around software company Sage’s upbeat quarterly profit. Photograph: Andrey Rudakov/Bloomberg
The UK’s FTSE 100 share index dipped on Wednesday, as hotter-than-expected inflation data tempered expectations for quick interest rate cuts, and overshadowed optimism around software company Sage’s upbeat quarterly profit. Photograph: Andrey Rudakov/Bloomberg
Fiona Keeley
Wed Nov 20 2024 - 18:36

Global shares edged lower on Wednesday as markets weighed geopolitical tensions between Russia and the West and as investors eyed earnings from artificial intelligence powerhouse Nvidia due late on Thursday evening, while bitcoin hit a new record high and the dollar rose.

Dublin

The Irish market outperformed its European peers on Wednesday, finishing up 0.6 per cent at the end of the day with banks nudging higher. AIB rose 1.31 per cent finishing at €5.43 and Bank of Ireland was up by 1.51 per cent to €8.87. Food supplier Kerry Group was up 1.17 per cent to €86.60, helping to push the overall index higher because of the company’s size. Kingspan was up 0.07 per cent to €72.35.

Home builders Cairn Homes rose 0.48 per cent to €2.09 a share. Glenveagh Properties was up 0.39 per cent to €1.55. Ryanair dropped 0.88 per cent to finish the day on €18.48.

London

The UK’s FTSE 100 share index dipped on Wednesday, as hotter-than-expected inflation data tempered expectations for quick interest rate cuts, and overshadowed optimism around software company Sage’s upbeat quarterly profit.

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The export-focused FTSE 100 closed down 0.2 per cent, but the technology sector index surged 6.2 per cent to touch a record high.

Sage Group reported a better-than-expected 21 per cent rise in operating profit, driven by a 220-basis-point margin increase, and said it expected further progress this year, sending its shares up 18% to an all-time high.

British inflation is further expected to rise, given finance minister Rachel Reeves’s recent budget containing higher employment taxes, spending and borrowing.

Investors around the world were also awaiting a quarterly report from leading AI chipmaker Nvidia late on Wednesday. The options market implied an 8.5 per cent swing for the shares in either direction following the results.

Real estate-related stocks including household goods and home construction lost over 2.8 per cent, while real estate investment trusts fell 1.6 per cent.

Europe

Europe’s main stock index closed flat after a volatile session on Wednesday as investors remained on edge over geopolitical tensions between Ukraine and Russia which continued to cast a shadow over the markets.

The pan-European STOXX 600 held its ground at 500.53 points. It declined for a fourth straight session – logging its longest losing streak in over two months.

It touched a three-month low on Tuesday amid an investor rush to safe-haven assets.

Automobile stocks led sectoral declines, falling 1.2 per cent.

It comes as Ford Motor Co will look to eliminate another 4,000 positions in Europe, further retrenching within a region where the transition to electric vehicles is losing traction industrywide.

The reductions – which amount to about 14 per cent of Ford Europe’s workforce – will primarily hit operations in Germany and the UK by the end of 2027, pending consultations with unions and governments. The automaker also announced it will reduce production of Explorer and Capri EVs at its complex in Cologne, Germany.

New York

Wall Street’s main indexes dropped on Wednesday, as well as the continued escalation of Russia-Ukraine tensions worried investors, while megacap Nvidia lost ground in advance of quarterly results.

Stocks dipped after a report Ukraine fired long-range British Storm Shadow missiles into Russian territory. That followed Ukraine launching US-made ATACMS missiles into Russia on Tuesday, and Russia announcing it had lowered the threshold for nuclear action.

Wall Street’s “fear gauge” jumped to 18.79 before easing slightly, but it was still trading at its highest since the Nov. 5 U.S. presidential election.

Meanwhile, AI leader Nvidia, which is scheduled to report results after markets close, dropped 0.8 per cent, reversing modest premarket gains. The index heavyweight dragged the Information Technology sector, as well as the tech-heavy Nasdaq.

Among other growth stocks, Tesla lost 1.8 per cent and Amazon.com shed 1.7 per cent.

The consumer discretionary and consumer staples indexes lost 1.1 per cent and 0.9 per cent, respectively.

But the spotlight remained on Nvidia, which has nearly tripled in value this year, accounting for about 20 per cent of the S&P 500′s returns over the last 12 months, according to Bank of United States global research. Additional reporting: agencies

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