Markets dip in Europe as US rate cut euphoria ebbs

European markets dipped yesterday as optimism sparked by news of a possible US interest rate cut fizzled away.

DUBLIN

Dealers described Thursday's trade as "mixed". Recruiter CPL Resources closed flat at €6.3783 after predicting that profits for its last financial year, which ended in June, would exceed expectations. The company's stock traded at high of €6.45 during the day.

Ryanair closed 1.14 per cent up at €10.19 on news that delays in new aircraft deliveries could prompt it to close or cut back bases this winter and that chief operations officer Peter Bellew will leave at the end of the year.

Traders said the shares actually fell below €10 in early trade, hitting a low of €9.85, before recovering strongly. “Ryanair was a bit all over the place, but they shrugged off the news and finished strongly,” said one.

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Banks made ground in Dublin on Thursday. Bank of Ireland climbed 1.12 per cent to €4.706 while AIB gained 1.34 per cent to €3.77.

Explorer Providence Resources tumbled 10.29 per cent to 12.2 cent. The company was recently notified that its Chinese backer Apec has transferred a €9 million loan to fund a survey of its Barryroe oil prospect to the Irish company's bank but it has yet to arrive.

LONDON

Irish-headquartered builders' supplier and DIY specialist, Grafton, owner of the Woodies chain, dipped 0.93 per cent to 748.5 pence sterling in London, where the company's shares are traded, after a trading statement on Wednesday.

Barratt, one of Britain's biggest house builders surged 5.17 per cent to 614.4p after saying that it expected pre-tax profits to grow to £910 million (€1 billion) for the period ended June 30th from £835 million a year ago.

Household goods giant Reckitt Benckiser, maker of Gaviscon and Harpic, saw shares rise after it agreed to pay $1.4 billion to resolve a US investigation into former subsidiary Indivior's opioid addiction drug. Shares in Reckitt closed up by 162p to 6,590p.

Indivior itself also had a very positive day, as its shares surged higher after it upped its revenue and profit guidance for the year. The London-based pharmaceutical firm said unexpectedly strong sales of Suboxone buoyed its revenues. Shares in the company were up 2.98p at 47.28p at the close of trading.

Shares in Land Securities closed lower after its chief executive, Robert Noel, announced plans to retire next year. Land Securities shares fell by 5p to 832.8p at the end of trading on Thursday.

Furniture retailer DFS saw shares rise after it affirmed its profit outlook, although it also warned of a weaker backdrop due to Brexit uncertainty. DFS shares closed up 5.5p at 243p.

EUROPE

Shares in Norwegian Air Shuttle ASA slumped after its veteran chief executive, Bjorn Kjos, said he was retiring and the airline announced that earnings had tripled to 622.8 million Norwegian kroner (€64.73 million). Its shares closed 12.61 per cent down at 39.07 kroner, despite the company showing signs that it was getting to grips with its debt problems.

Chief financial officer Geir Karlsen is taking over as interim chief executive. Mr Kjos, a former Norwegian Air Force pilot, led Norwegian since founding it in 1993.

Elsewhere, the German Dax decreased by 0.33 per cent, while the French CAC fell back by 0.28 per cent.

NEW YORK

US stocks edged higher on Thursday on improved prospects of an interest rate cut. Healthcare stocks were mixed after the White House withdrew a proposed rule that would kill rebates.

A 5.5 per cent gain in UnitedHealth helped the Dow Industrials briefly break above 27,000 points for the first time.

Cigna surged more than 12 per cent, leading gains on the S&P 500, while drug distributors such as McKesson rose 2.2 per cent. However, drugmakers such as Merck dropped 3.1 per cent and the Nasdaq biotech index slipped 1.66 per cent. – Additional reporting, Reuters