Stocks slide on weak US jobless data

A gauge of global stocks was headed for its second consecutive decline on Thursday after a sharp decline in Tesla shares coupled with weak US jobs data.

Shedding 0.2 per cent by closing bell in Dublin, MSCI’s world index was on track for its largest single-day percentage decline in two weeks as European and US indices slipped.

Dublin

A quiet day in Dublin saw the Iseq index slip by close to 0.4 per cent, underperforming its European peers.

It was a mixed session for the Irish banks with Bank of Ireland shedding more than 1.8 per cent to €9.69 while AIB added 1.4 per cent to close at €3.95 per share. “It’s unusual to see divergence like that,” said one in trader in Dublin, “but I wouldn’t put it down to anything stock specific.”

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FBD, meanwhile, topped the table, adding 3.5 per cent to close at €13.30 after its shares reached the cut-off date for registered investors to be entitled to an upcoming dividend payment. Shareholders will have to approve the proposed €1 per share dividend at the insurer’s AGM next month.

Meanwhile, shares in Smurfit Kappa fell 2.4 per cent to €33.69 per share, a negative read-through from its Nordic papermaker rival Stora Enso, which lowered its full-year profit guidance on Thursday.

London

The main London indices remained weak on Thursday, tracking declines in oil and mining stocks commodities prices slipped amid concerns over further rate hikes by the US Federal Reserve.

Down as much as 0.2 per cent at one stage, the blue-chip FTSE 100 index was essentially flat on the session while the mid-cap FTSE 250 declined by 0.3 per cent.

BP, down more than 0.8 per cent, and Shell, off by 0.3 per cent on the session, both fell with crude prices tumbling against the dollar as rate hike fears hurt growth and weighed on fuel demand. Base metal miners also slipped, with shares in Antofagasta down 2.5 per cent, leading declines while Rio Tinto fell by 1.6 per cent.

Meanwhile, shares in real estate investment trust Segro added 3.5 per cent after positive results hinted at rebounding demand for UK commercial property.

Europe

The pan-European Stoxx 600 index, which hit 14-month highs on Tuesday, fell by close to 0.2 per cent while the blue-chip Stoxx 50 was flat on the session.

A note of caution set in after hawkish comments from ECB policymakers followed alarming British inflation data on Wednesday, suggesting central banks may have to continue prioritising price stability over supporting economic growth.

Luxury names topped the blue-chip index on Thursday. Shares in L’Oreal added 1.7 per cent after the cosmetics-maker reported a 13 per cent rise in first-quarter sales, beating expectations thanks to strong business in the United States and Europe. Hermés and LVMH also added 1.6 per cent and 1.3 per cent.

Moving in the opposite directions, German automakers were among the biggest losers in the session after BMW was forced to apologise for offering free ice cream to foreign visitors at a Shanghai motor show but turning away Chinese customers. Daimler and Volkswagen also shed more than 3 per cent.

Elsewhere on the monetary policy front, European Central Bank Governing Council member Klaas Knot said the ECB may need to follow a widely expected hike next month by raising rates in June and July. There has to be “a convincing reversal” in price pressures before a pause in the tightening cycle, he said.

New York

US stocks fell and bonds rose after fresh data showed recurring unemployment benefit claims jumped to the highest level since November 2021, adding to signs that the labour market is beginning to lose momentum.

The S&P 500 fell 0.4 per cent by closing bell in Dublin while the Nasdaq shed 0.3 per cent and the Dow Jones Composite index was off by 0.2 per cent.

Tesla tumbled 8.7 per cent to touch its lowest in more than a month after its first-quarter gross margin missed expectations due to aggressive price cuts on its vehicles.

AT&T slid 9.4 per cent as the wireless carrier missed estimates for first-quarter revenue, while American Express slipped 3.2 per cent on missing first-quarter earnings expectations.

– Additional reporting: Bloomberg, Reuters