Irish shares fell on Monday ahead of the budget on Tuesday, as traders cleared their books ahead of the end of the third quarter of the year.
Dublin
The Iseq Overall Index fell 2.13 per cent.
From a banking perspective, Bank of Ireland closed 4.34 per cent lower finishing at €10.03 on Monday. AIB dropped 2.92 per cent to €5.15, while Permanent TSB rose 1.74 per cent to €1.75.
Housebuilders are another sector the market has a close eye on as the budget approaches, with expectations focused on what, if any, incentives to build more homes could be unveiled. Cairn Homes dropped 1.5 per cent to €1.96 and Glenveagh Properties fell 2.14 per cent to €1.55 a share. In the food groups, Kerry Group fell 0.37 per cent to €93.15 and Glanbia fell 1.80 per cent to €15.81.
London
In London, wider economic sentiment was dented by confirmed economic growth data for the second quarter.
UK gross domestic product (GDP) grew by less than expected between April and June, according to revised figures from the Office for National Statistics (ONS).
The FTSE 100 finished 1.01 per cent lower.
Dan Coatsworth, investment analyst at AJ Bell, said: “It’s remarkable how sentiment can swiftly change direction on the markets.
“After last week’s strong showing led by Chinese stimulus measures, US and European markets were in retreat at the start of the new trading week.”
In company news, Aston Martin was among the heaviest fallers in London after it warned over annual earnings and slashed vehicle production for 2024 because of supplier disruption and weak demand from China.
Europe
The Cac 40 ended 2 per cent lower for the day and the Dax index was down 0.68 per cent at the close.
European auto stocks were at the helm of losses, down 4 per cent with Milan-listed shares of Stellantis sliding 14.7 per cent after Europe’s second biggest carmaker cut its 2024 profit forecast and warned it will burn through more cash than expected. Volkswagen had also cut its annual outlook for the second time in less than three months late on Friday, sending its shares down 4.3 per cent.
The latest data on consumer prices, published earlier on Monday, showed slowdowns in Italy and Germany, following numbers last week in Spain and France pointing in the same direction. That reinforces the idea that a historic spike in inflation has been contained.
New York
The Dow and the S&P 500 were hovering near all-time highs and were set to log gains for the fifth straight month, bucking a historical trend where September has been weak for equities on average.
Gains sparked by the Fed’s start to monetary policy easing nearly two weeks ago have propped Wall Street’s three main indexes for a quarterly rise as well.
Economists say that a mistake in setting interest rates during the last phase of the Fed’s inflation battle could be risky for the economy over the next year. Chairman of the Federal Reserve Jerome Powell said at a conference on Monday that the United States was on a solid economic footing.
“Inflation is now much closer to our 2 percent objective. Today, we see the risks to achieving our employment and inflation goals as roughly in balance.”
Recent data supporting the trend of moderating price pressures and an overall resilient economy has granted the Fed enough room to focus on the labour market and avoid a recession by reducing borrowing costs further.
CVS Health rose 1.9 per cent after a report showed hedge fund Glenview Capital Management will meet top executives at the struggling healthcare company.
Automakers Ford dropped 2.5 per cent and General Motors lost 3.9 per cent after European peer Stellantis NV slashed its annual forecasts. – Additional reporting: Agencies
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