Business

European shares close at record high as investors’ risk appetite increases

Britain’s FTSE 100 finishes at new high for fifth consecutive trading session

Traders work on the floor of the New York Stock Exchange (NYSE). Photograph: Spencer Platt/Getty Images

Laura Slattery
Fri May 10 2024 - 19:06

Europe’s main stock index closed at a record high on Friday, on track for its biggest weekly gain since late January, as risk appetite was bolstered by growing bets on interest rate cuts in the region and a strong earnings season.

Dublin

The Iseq finished the week on a positive note, adding 0.4 per cent, as the Dublin market was lifted by a 1.1 per cent climb for Ryanair. The airline closed at €18.96, with its stock the most active on the Iseq on the day.

Elsewhere, it was a mixed bag for key stocks, with packaging group Smurfit Kappa finishing flat at €43.75 and insulation-maker Kingspan slipping 1.5 per cent to €89.15.

Food group Kerry rose 0.6 per cent to €80.00, while the banks were also in positive territory, with AIB up 2 per cent at €4.99 and Bank of Ireland edging up 0.3 per cent to €9.85.

READ MORE

London

Britain’s FTSE 100 hit a record high for a fifth straight session on Friday as investors cheered the Bank of England’s dovish tone while the British economy grew more than expected in the first quarter of the year.

The blue-chip FTSE 100 ended 0.6 per cent higher, notching a new peak and breaching the 8,400 mark earlier in the session. The mid-cap FTSE 250 hit its highest level in more than two years and also closed 0.6 per cent higher. Both indexes logged a third consecutive week of gains.

The British economy exited recession with stronger-than-expected growth of 0.6 per cent in the first quarter, the most in nearly three years.

Industrial metal miners led sectoral gains with a 1.4 per cent rise. Anglo American added 1.4 per cent after the Australian Financial Review reported that Rio Tinto had considered an offer for the miner.

Vodafone Group was up 1.9 per cent after the British government made a final order to conditionally approve the proposed merger between the telecom company’s UK operation and Hutchison’s Three UK.

Europe

The pan-European STOXX 600 ended 0.7 per cent higher, with indexes in major economies Germany and France finishing at record highs. European shares have resumed their record-breaking rally, with the STOXX 600 notching a 3 per cent weekly gain, after investors took a breather in April.

Italian utility firm Enel climbed 3.8 per cent following a higher first-quarter core profit, while Portugal’s largest utility firm EDP climbed 3.9 per cent after a bigger-than-expected jump in first-quarter net profit.

Retailers added 1.5 per cent, with Zalando rising 3.3 per cent after analysts at Berenberg upgraded the German online retailer to “buy” from “hold”.

Among M&A developments, shares of BBVA and Sabadell were up 1.3 per cent and 0.5 per cent respectively, as investors assessed the developments around the first hostile banking takeover bid in Spain since the 1980s.

Sanofi rose 1.3 per cent after Novavax struck a licensing deal with French drugmaker for its Covid vaccine in exchange for a stake that valued the US biotech firm at double its current market capitalisation. In the US Novavax more than doubled in value.

On the flip side, Getinge slumped 8.8 per cent the US Food and Drug Administration issued a warning on the safety of two of the Swedish medical equipment maker’s heart devices.

US

Wall Street stock indexes were mixed on Friday, but looked on track for weekly gains ahead of key inflation readings next week that could provide more clues on how soon the Federal Reserve will start cutting interest rates.

Most megacap stocks including Tesla, Alphabet and Apple slipped as US Treasury yields rose.

Nvidia gained 0.8 per cent after Taiwan Semiconductor Manufacturing, the world’s largest chipmaker and a major supplier to Nvidia, reported a near 60 per cent jump in April sales.

SoundHound AI jumped 11 per cent after its first-quarter revenue beat market estimates.

Additional reporting: Reuters

Laura Slattery

Laura Slattery

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

LATEST STORIES