Business

European stocks recoup early losses and finish higher

Investors added to bets that the Federal Reserve will cut interest rates later this month

A Christmas tree outside the New York Stock Exchange (NYSE). Investors anticipate that the Federal Reserve will cut rates this month. Photograph: Michael Nagle/Bloomberg
A Christmas tree outside the New York Stock Exchange (NYSE). Investors anticipate that the Federal Reserve will cut rates this month. Photograph: Michael Nagle/Bloomberg
Laura Slattery
Wed Dec 11 2024 - 18:23

European stocks recouped earlier losses and closed up on Wednesday, as investors added to bets that the Federal Reserve could lower interest rates later in the month after an in-line US inflation report.

Closer to home, focus will be on the European Central Bank’s policy move on Thursday, with most investors expecting the bank to announce a further quarter of a percentage point cut to interest rates.

Dublin

Gains for Bank of Ireland and Kerry pushed the Iseq into positive territory in Wednesday’s session, with the Dublin market finishing up 0.3 per cent on the day.

Bank of Ireland advanced 2.5 per cent to €8.95, though AIB went the other direction, slipping 0.5 per cent to €5.38.

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Food group Kerry posted a climb of 0.8 per cent, closing at €90.05, but Ryanair edged down 0.1 per cent to €19.28.

Building materials group Kingspan, another of the more active stocks changing hands, also nudged 0.1 per cent lower, finishing at €71.20.

London

The FTSE 100 index finished 0.3 per cent higher, while the mid-cap FTSE 250 was flat.

Precious metal miners led the sectoral gains for UK stocks, advancing 5.1 per cent, tracking gains in gold prices after the data. Gold miner Endeavour Mining climbed 5.9 per cent.

Banking group Lloyds advanced 2.4 per cent after British lender Close Brothers was granted permission to appeal a ruling that motor finance brokers must fully inform customers about commissions on car loans.

The pound weakened against the dollar, also boosting export-oriented stocks in the FTSE 100.

Energy stocks were down 1 per cent, led by Shell which dropped 1.2 per cent to be a bottom performer in the blue-chip index.

Kainos Group was a top gainer on the mid-cap index, soaring 4.5 per cent, after Northern Ireland’s biggest IT firm reappointed Brendan Mooney as chief executive.

Europe

The pan-European Stoxx 600 index had slipped earlier in the day, but settled higher by 0.3 per cent after US data showed the Consumer Price Index (CPI) rose as expected in November on both a monthly and annual basis.

The aerospace and defence sector led gains on the day with a 1.4 per cent rise and has witnessed the biggest gains among peers this year. Investors monitored Ukraine’s latest strike on Russia using US-made missiles.

However, disappointing corporate updates kept a lid on advances, with Zara owner Inditex sliding 6.5 per cent after the world’s biggest listed fast-fashion retailer posted a rare miss on third-quarter sales.

Spain’s main index hit a one-week low and the broader Stoxx retail index dropped 1.8 per cent and notched its biggest percentage drop in more than a month.

Carl Zeiss slid 12.2 per cent after the German optical systems maker reported weaker-than-expected full-year results.

TUI rose 3.33 per cent after Europe’s largest tour operator reported higher profit in the 2024 financial year and projected further growth next year.

US

The Nasdaq crossed 20,000 points for the first time, as tech stocks rallied after the latest inflation report raised hopes of a rate cut by the US Federal Reserve later this month.

Most mega-cap and growth stocks were higher, with Alphabet up 4.6 per cent and Tesla gaining 3.1 per cent. Both hit all-time highs on an intraday basis.

GameStop gained 9.9 per cent after the video game retailer reported a profit for the third quarter on cost-saving efforts.

Broadcom jumped 5.3 per cent following a report that Apple is working with the company to develop its first server chip specially designed for artificial intelligence.

Macy’s shed 5.7 per cent after the department-store bellwether cut its annual profit forecast.

Additional reporting: Reuters

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Laura Slattery

Laura Slattery

Laura Slattery is an Irish Times journalist writing about media, advertising and other business topics

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