European stocks whipsawed on Friday, ultimately ending the week lower, as oil prices moved back above $100 (€87) a barrel and traders reduced risk before the weekend.
The US increased strikes on Iran to unprecedented levels as the war that’s engulfed the Middle East hit the two-week mark and continued to upend global markets.
Dublin
The Euronext Dublin fell 0.6 per cent on Friday as small gains in food and some financial stocks were outweighed by sharp declines in construction companies.
Insulation specialist Kingspan was 2.2 per cent lower over the day, falling to €72.95. Homebuilders Glenveagh and Cairn also saw significant declines, falling 3.3 per cent and 2.4 per cent respectively.
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Ryanair lost under 1 per cent by the end of the day, slipping further after Thursday’s 2.9 per cent decline.
Bank of Ireland was down half a per cent, while Permanent TSB was down 0.3 per cent by the end of the day.
On the more positive end of the market, Glanbia shares rose almost 0.6 per cent, while Kerry Group was 0.2 per cent higher over the day.
AIB was the only positive sign among the financial stocks, with its shares recovering slightly from the previous day’s slide. It added 0.1 per cent to close at €8.94 for the day.
London
British stocks posted their second straight week of losses on Friday, as the Middle East conflict heightened fears about inflation and clouded the Bank of England’s monetary policy outlook.
The blue-chip FTSE 100 was down 0.4 per cent, while the mid-cap FTSE 250 fell 0.4 per cent. Both indexes logged a second week of losses, although the declines were less severe than last week.
GDP showed zero growth in January. The median prediction in a Reuters poll of economists was for a 0.2 per cent month-on-month increase.
The heavily weighted UK energy index was up 1.1 per cent with oil majors BP and Shell up 0.9 per cent and 1.1 per cent respectively, as Brent crude prices traded above $100 a barrel.
HSBC and Standard Chartered fell 1.2 per cent and 3.2 per cent respectively as both are heavily invested in the Gulf’s rise as a global finance hub, and have seen operations disrupted as the Iran conflict rattles their Middle East ambitions.
Europe
The Stoxx Europe 600 closed 0.5 per cent lower, notching the index’s first back-to-back weekly declines this year. Energy and utilities shone, rising by more than 1 per cent, while energy-intensive cyclicals such as miners and industrials underperformed.
Stocks had earlier risen on a report that several European nations were in talks to Iran regarding safe passage of their ships through the Strait of Hormuz, but the gains soon faded as another news report said the Pentagon was moving additional marines and warships to the Middle East.
Luxury stocks took a hit in the last hour of trading, dragged down by a drop of more than 4 per cent in sector heavyweight LVMH, after Morgan Stanley slashed its price target, noting, among other factors, the impact of the Middle East war on revenue. The stock dropped to its lowest level since August, shedding €10 billion in market value.
Other big movers included BE Semiconductor Industries NV, which surged to an all-time high after Reuters reported the semiconductor equipment firm was fielding takeover interest. Zalando rose following an upgrade from Bernstein. While laggards included Vivendi SE, which fell after revenue missed forecasts, and housebuilder Berkeley Group Holdings, which declined after warning the conflict was “weighing heavily on risk sentiment”.
New York
Volatility gripped Wall Street on Friday, with stocks erasing gains as the war in Iran showed no signs of easing.
The S&P 500 erased a nearly 1 per cent advance, falling 0.4 per cent as of 12.03pm New York time, while the Nasdaq 100 fell 0.5 per cent. as the Wall Street Journal reported the Pentagon is moving a marine expeditionary unit to the Middle East, with Iran stepping up its attacks on the Strait of Hormuz. – Additional reporting: Reuters, Bloomberg
