US-China deal con­cerns dampen mar­kets

Euro­pean shares fall and US stocks plunge to wipe out rally in risk as­sets Iseq falls by 2.5% as AIB and Bank of Ire­land help drag the in­dex down

The Irish Times - Business - - MARKETS - MARK PAUL

Euro­pean shares fell yes­ter­day, led lower by auto stocks as in­vestors started to ques­tion whether the truce agreed by the United States and China on their trade dis­pute would lead to a long-term deal. US stocks plunged, with the Dow Jones In­dus­trial Av­er­age tum­bling more than 800 points, as a litany of con­cerns wiped out the rally in risk as­sets.

DUBLIN

The Iseq fell 2.5 per cent, tracking its Euro­pean peer in­dices, which all strug­gled on a day dom­i­nated by gloom over global trade prospects.

The State’s two pil­lar banks per­formed poorly, which helped to drag the in­dex down.

Bank of Ire­land fell 3.6 per cent to close the ses­sion at €5.34, while AIB dropped 2.7 per cent to fin­ish at €3.70.

Build­ing ma­te­ri­als be­he­moth CRH, which is usu­ally af­fected by wor­ries over global trade due to its heavy pres­ence in the US and world­wide , fell 3.8 per cent to €24 per share.

Ryanair fell 2.3 per cent to €11.40, de­spite strik­ing a deal with Ger­man unions.

LON­DON

The Ftse 100 closed down 0.6 per cent, with the stronger ster­ling drag­ging on its ex­porter-heavy con­stituents.

Thomas Cook shares fell as much as 16.9 per cent to hit their low­est level in six years amid grow­ing con­cerns about the tour op­er­a­tor’s debts. The shares closed 3.9 per cent lower af­ter an ex­tremely choppy ses­sion as in­vestors braced for the stock to be de­moted from the mid­cap in­dex.

The quar­terly reweight­ing of the in­dexes also roiled some shares, with His­cox ex­pected to oust Royal Mail from the blue chips and sto­ried car­maker As­ton Martin set for pro­mo­tion to the mid­cap in­dex just two months af­ter its IPO. Fi­nal moves will be an­nounced by the LSE to­day based on mar­ket cap at yes­ter­day’s close.

BAE Sys­tems, down 5.5 per cent, was one of the big­gest de­clin­ers af­ter Deutsche Bank cut its price tar­get on the stock. Min­ing stocks such as Antofa­gasta and Glen­core, down 3.5 and 1 per cent re­spec­tively, fell as cop­per prices eased back on doubts over how frag­ile a trade truce struck at the G20 on Satur­day was.

EUROPE

French cater­ing group Elior sank 8.6 per cent af­ter cut­ting its sales growth out­look, and Bel­gian postal ser­vices firm Bpost plunged 22.8 per cent af­ter a profit warn­ing. France’s JCDe­caux fell 2.9 per cent af­ter Ex­ane BNP Paribas reini­ti­ated its cov­er­age of the stock with an “un­der­per­form” rat­ing.

En­ergy stocks gave up ear­lier gains as crude prices came off highs on wor­ries that de­mand would stall due to a Sino-US trade war, and that Rus­sia re­mained a stum­bling block to a deal to cut global crude sup­ply.

Ger­man in­dus­trial gases group Linde will re­place Bri­tish bank Bar­clays on the lead­ing in­dex of pan-Euro­pean stocks Stoxx Europe 50, it was an­nounced. The change comes as part of the quar­terly reshuf­fle and will be ef­fec­tive at the open­ing of Euro­pean trad­ing on De­cem­ber 24th. Linde shares rose 2.1 per cent and Bar­clays was down 2.6 per cent.

NEW YORK

Wall Street tum­bled more than 3 per cent, led lower by bank and in­dus­trial shares, as the US bond mar­ket sent un­set­tling signs about eco­nomic growth and in­vestors wor­ried anew about global trade.

The Dow Jones In­dus­trial Av­er­age fell 799.36 points, or 3.1 per cent, to 25,027.07, the S&P 500 lost 90.31 points, or 3.24 per cent, to 2,700.06 and the Nas­daq Com­pos­ite dropped 283.09 points, or 3.8 per­cent, to 7,158.43. The New York Stock Ex­change and Nas­daq will be closed to­day, for a day of mourn­ing for for­mer Pres­i­dent Ge­orge HW Bush, who died on Fri­day at the age of 94.

The trade-sen­si­tive in­dus­trial sec­tor fell 4.4 per cent, with

Boe­ing and Cater­pil­lar de­clin­ing 4.9 per cent and 6.9 per cent, re­spec­tively.

Brent crude oil set­tled at $62.08 per bar­rel, or jumped up 0.63 per cent. U.S. light crude was last up 30 cents at $53.25. – ad­di­tional re­port­ing Reuters

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