Global equities slide amid fears over US debt ceiling

Global equities slid on Tuesday as talks over the US debt ceiling continued without resolution, and yields on one-month US Treasury bills hit a record high.

Dublin

The Dublin market was little changed on the day despite a strong showing from Ryanair after it published its full-year results on Monday.

Investors were impressed after the airline’s accounts showed it swung back into profit over the past year due to strong traffic recovery, higher air fares and advantageous fuel hedges. It finished the day up 5 per cent.

“They are on an extensive roadshow and we saw some big buyers come in during the afternoon,” a trader noted.

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Its peers Wizz Air and EasyJet were down 2 per cent and 30 basis points respectively, while Aer Lingus parent International Airlines Group was up slightly at close of business.

In the financial sector, a trader noted there was “good demand in the Irish bank space”, with Bank of Ireland up 3 per cent while AIB climbed 1 per cent.

Elsewhere, box-maker Smurfit Kappa finished the day up 2 per cent, while agri-services group Origin Enterprises climbed 3 per cent. “Origin has been under quite a bit of pressure so it seems to have turned the tide today,” said a trader.

While it was mostly green on the board, two of the indexes bigger hitters – Paddy Power Betfair owner Flutter Entertainment and building materials giant CRH – were down 1.8 per cent and 1.4 per cent respectively.

London

In company news, housebuilder Barratt Developments said that it was parting ways with its chairman John Allan, who has been accused of wrongdoing in some of his other roles. Shares in Barratt closed down 1.4 per cent on Tuesday.

Elsewhere, SSP – the company behind sandwich seller Upper Crust – hiked its annual guidance as the travel sector bounced back from its pandemic woes. Shares in the business rose by 3.1 per cent.

The biggest risers on the FTSE 100 were Vodafone, up 2.43p to 84.08p, British Land, up 9.3p to 365.7p, British American Tobacco, up 60p to 2,738.5p, Kingfisher, up 5.2p to 246.8p, and Barclays, up 3.36p to 163.44p.

Europe

European shares fell, knocked down by losses in luxury majors and a weak update from Swiss wealth manager Julius Baer, while investors were also vigilant of economic data from the region and the US debt ceiling deadlock.

The pan-European Stoxx 600 index closed 0.6 per cent lower, logging its steepest one-day percentage fall in three weeks.

LVMH, Europe’s most valuable company, fell 5 per cent, having gained nearly 23 per cent so far this year. Peers Hermes and Kering dropped 6.5 per cent and 3 per cent respectively.

The German Dax index dropped 0.4 per cent, while France’s Cac 40 dropped 1.3 per cent.

New York

Wall Street indexes fell as talks over increasing the US debt limit stretched to another round, keeping investors jittery on prospects of an unprecedented government default.

Trading on the S&P 500 index was stuck in a 30-point range in the last two sessions as US debt ceiling talks lingered, while a megacaps-led bounce on the Nasdaq helped it close the previous day higher.

Broadcom advanced 1.3 per cent after the chipmaker entered into a multi-billion-dollar deal with Apple to use chips made in the United States. Apple shares fell 0.8 per cent.

Among retail earnings, Lowe’s Companies cut its annual comparable sales forecast, as demand dwindles for home improvement goods. It gained 2.4 per cent.

BJ’s Wholesale Club Holdings dropped 6.6 per cent after the warehouse club operator missed first-quarter revenue estimates.

Zoom Video Communications fell 5.7 per cent after the video conferencing platform recorded its slowest quarterly revenue growth.

Shares of regional lenders extended gains from the previous session, led by a 19.7 per cent rise in PacWest Bancorp.

Western Alliance Bank, Zions Bancorp, KeyCorp and First Horizon Corp rose between 2 per cent and 4.6 per cent. (Additional reporting: Agencies)