European shares rise amid cooling interest rate concerns

Europe’s top markets continued their recent strong spell as trading sentiment remained calm amid cooling interest rate expectations and the winding down of the latest earnings season.

DUBLIN

The Irish index of shares fell more than 1.2 per cent, bucking the wider European trend. Banking shares were mixed, with AIB down 0.8 per cent to €2.82, while Bank of Ireland was largely flat at €7.28. Permanent TSB closed at €1.73, down almost 0.6 per cent. Packaging group Smurfit Kappa was half a per cent off, while Kingspan gave up some of last week’s gains, to close almost 5 per cent lower at €60.96. Paddy Power owner Flutter Entertainment lost almost 3 per cent to close the day at €129.90.

LONDON

Buoyant health stocks helped to bolster the FTSE 100 on Monday as the recent purple patch helped take the index to its highest close in two months. London’s top index finished the day up 67.13 points, or 0.92 per cent, at 7,385.17.

The FTSE also benefited from weakness in the pound in advance of a pivotal weak for economic data and details of the new UK government’s potential tax hikes and spending cuts. The pound was down 0.92 per cent against the dollar at 1.173, and was 0.71 per cent lower against the euro at 1.134 at the close.

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In company news, events and subscriptions firm Informa shot higher after lifting its full-year earnings outlook amid strong demand for in-person and online events. The FTSE 100-listed company said it was upping its revenue guidance by about £100 million and its profits by £15 million for the full year. The firm closed 31.8p higher at 584.4p on Monday as a result.

Meanwhile, fashion firm Joules saw its shares suspended after it filed a notice to appoint administrators on Monday, putting 1,600 jobs at risk. The company floated on the stock market with a £140 million valuation in 2016.

Pantheon Resources tumbled in value after reports that short seller Muddy Waters had bet against the AIM-listed company.

EUROPE

European shares closed higher on Monday driven by positive updates from companies including Germany’s Infineon and Britain’s Informa, while investors positioned themselves for a slew of data including inflation and flash GDP due this week. The pan-European STOXX 600 index rose 0.1 per cent, hovering near 11-week highs.

Germany’s Dax gained 0.6 per cent. Shares of Infineon climbed 7.8 per cent to top the index after the chipmaker raised its long-term financial targets and said it is planning a new €5 billion factory in Dresden to expand its 300mm production capacities.

Among other stocks, Roche Holding slid 4 per cent to weigh the most on the STOXX 600 after its Alzheimer’s drug candidate could not be shown to markedly slow dementia progression in two drug trials. Rheinmetall climbed 6.7 per cent after the military equipment manufacturer agreed to buy Spanish explosives and ammunition maker Expal Systems for an enterprise value of €1.2 billion.

NEW YORK

US stocks climbed after Federal Reserve vice-chair Lael Brainard said that it would be appropriate “soon” for the central bank to slow its pace of interest-rate hikes, which signalled to some investors that she favours a half-point hike as early as next month. The S&P 500 rose after wavering for most of the session. The tech-heavy Nasdaq 100 also gained after falling as much as 1.3 per cent earlier in the session.

Meanwhile, Chinese stocks listed in the US extended their rally to a third day, after Joe Biden and Xi Jinping called for reduced tensions between the world’s two biggest economies during a meeting in Bali, Indonesia.

The DAX Index, Germany’s main equity benchmark, rallied 20 per cent from its September low. It was set to enter a bull market as investors bought shares on optimism that China is easing Covid restrictions and that its relations with the US are improving.

Cryptocurrencies rose on plans by Binance Holdings to set up a recovery fund to stabilise the industry after FTX’s bankruptcy sparked marketwide losses of about $200 billion in the past week.