Business

European markets edge up as investors mull latest inflation data

US and German consumer price inflation seen as in line with forecasts, easing investor worries

Traders on the floor of the New York Stock Exchange. Wall Street’s main indexes rose on Thursday as a key inflation metric came in in line with estimates, raising hopes of interest rate cuts by the US Federal Reserve in the first half of the year. Photograph: Michael M Santiago/Getty Images

Eoin Burke-Kennedy
Thu Feb 29 2024 - 17:24

European markets closed marginally higher on Thursday as investors monitored key inflation data.

The Stoxx 600 index closed up 0.1 per cent, slightly extending earlier gains after the US personal consumption expenditures price index, excluding food and energy costs – the Federal Reserve’s preferred measure of inflation – rose in line with expectations by 0.4 per cent monthly and 2.8 per cent annually in January.

German consumer price inflation also came in line with forecasts at 2.7 per cent year-on-year, ahead of euro zone figures due out on Friday.

The decline in inflation mirrored regional inflation data released by several German states earlier in the day that indicated price pressures would also ease on a national level.

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Dublin

CRH shares soared to a record high on Thursday after the building materials giant accompanied a strong set of full-year results and outlook for this year by outlining plans to spend $35 billion (€32.3bn) over the next five years on deals, investment and payments to investors.

The market value of the company rose as much as 6.1 per cent to $57.4 billion on Wall Street. The company delisted from Dublin last year.

Cairn Homes fell 2.3 per cent to €1.45 after announcing record revenue and profits for 2023. The homebuilder said it was targeting growth of 30 per cent this year, with 2,200 units and operating profit of around €145 million.

AIB and Bank of Ireland were among the top fallers on the Iseq, trading down 1 per cent and 3.4 per cent respectively. The moves come as investors wait for indications on the European Central Bank’s next move on interest rates.

Europe

European sectors were mixed, with construction stocks up 1.2 per cent while healthcare and food and beverage both fell 0.7 per cent.

Shares of Budweiser-owner AB InBev, the world’s biggest brewer, dipped 1.8 per cent after narrowly missing full-year profit and revenue forecasts.

German manufacturer Aixtron, meanwhile, slid 13.7 per cent despite beating consensus expectations on fourth-quarter revenue and meeting growth guidance for the full year as it said it expected to grow revenue and profit in the year ahead.

It was a busy day for regional earnings, with AF-KLM, Veolia, Adecco Group, EDP, IAG, Ocado, ITV, Man Group, Schroders and Covestro also reporting.

London

London’s FTSE indexes moved higher after a busy morning of corporate results with major risers and fallers at both ends of the blue-chip index. Despite trading higher both main indexes were some way off eclipsing Wednesday’s sell-off.

“The FTSE 100 has been in positive territory with Haleon and Ocado among the top gainers in early trade as investors were encouraged by their latest results,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown.

“St James’s Place has made up small ground after the dramatic slide yesterday, but considerable nervousness remains after it was forced to set aside a hefty sum to deal with customer complaints,” Streeter added.

Consumer healthcare giant Haleon jumped to the top spot on the FTSE 100, with its shares rising nearly 5 per cent. The firm reported a healthy 10.3 per cent increase in adjusted operating profit and proposed a dividend payout of 35 per cent, up from 30 per cent last year.

New York

Wall Street’s main indexes rose on Thursday as a key inflation metric came in in line with estimates, raising hopes of interest rate cuts by the US Federal Reserve in the first half of the year.

A commerce department report showed the personal consumption expenditures price index, the Fed’s preferred inflation gauge, climbed 0.3 per cent in January month-on-month, as expected. Prices rose 2.4 per cent on a yearly basis, also matching estimates.

Additional reporting by Reuters/Bloomberg

Eoin Burke-Kennedy

Eoin Burke-Kennedy

Eoin Burke-Kennedy is Economics Correspondent of The Irish Times

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