Markets pegged back by rising oil prices and inflation worries

Major US stock indexes were higher on Tuesday in choppy dealings as Europe slipped despite bumper BP profits, while the euro was pegged back as the European Central Bank tried to cool interest rate hike expectations.

DUBLIN

Euronext Dublin finished the day flat on Tuesday, but the banks and the airlines continued their recent upward momentum.

Irish energy and services group DCC was down 2.5 per cent despite the group earlier reporting its operating profit for the third quarter was in line with expectations, beating 2020 figures.

“It had a good move already this week,” noted a trader. “There was nothing ugly in the numbers per se, there just wasn’t a whole lot to push it on.”

European shares boosted by strong earnings and reports of M&A

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Bank of Ireland and AIB continued their recent upward moves, ending the day up 3 per cent and 4.8 per cent respectively. “The Irish banks really benefited from all the talk of higher inflation and increased interest rates,” said a trader. “There was a decent bit of volume too.”

The airlines also continued to build on recent momentum with Easyjet up 4 per cent; Lufthansa up 5 per cent; and Aer Lingus parent International Airlines Group up 4 per cent. Ryanair underperformed its peers, ending the day up 1 per cent.

In the construction industry, insulation specialist Kingspan was down 2.5 per cent. “There are overhanging issues with regards to the Grenfell investigations in the UK, and until those are cleared up, the market is going to be a bit cautious,” said a trader.

LONDON

London stocks closed lower as an early bounce in energy major BP faded with sliding oil prices, while online supermarket Ocado tumbled following bleak earnings forecast.

After gaining as much as 0.7 per cent earlier in the session, the UK’s blue-chip FTSE 100 slipped 0.1 per cent, and midcap stocks also ended the session 0.1 per cent lower.

Shares in BP fell 2.4 per cent after hitting their strongest since March 2020 earlier in the session following results that showed its highest profit in eight years in 2021.

Rival Shell dropped 3.2 per cent, tracking weakness in oil prices that shed about 3 per cent before the resumption of US-Iran talks, which could revive an international nuclear agreement and allow more oil exports from the Opec producer.

The biggest decliner on the FTSE was Ocado Group, which slumped 12.9 per cent after it warned core earnings in 2022 would undershoot market expectations as it steps up investment in automated warehouses around the world.

EUROPE

European shares ended flat as rising bond yields pressured technology stocks. The benchmark Stoxx 600 closed largely unchanged.

Carmaker Stellantis rose 0.8 per cent after it unveiled its new Alfa Romeo Tonale SUV, as it aims to expand in the premium market and pivot further to electric vehicles.

EDF fell 1.3 per cent, after the French state-controlled power group made new cuts to its nuclear output projections.

French bank BNP Paribas fell 0.5 per cent on reporting lower than expected pre-provision fourth-quarter profit hit by higher costs.

Swedish Security services group Securitas gained 1.5 per cent after posting higher quarterly profit and saying demand for airport security, which plunged early in the pandemic, was recovering.

NEW YORK

The S&P 500 and the Nasdaq declined as disappointing earnings from Pfizer and declines in megacap technology names added to jitters ahead of inflation data this week that could spark bets on quicker interest rate hikes.

Pfizer fell 5.3 per cent after the drug maker’s full-year sales forecast for its Covid-19 vaccine and antiviral pills fell short of Wall Street estimates.

Facebook-owner Meta Platforms fell 1.4 per cent after billionaire investor Peter Thiel decided to step down from the company’s board. The stock is down for a fourth session after its bleak forecast wiped out billions of dollars in market value last week.

Other high-growth stocks like Google-owner Alphabet and Amazon.com fell 1 per cent each, while big banks like Bank of America and JPMorgan Chase & Co jumped 2.5 per cent each. (Additional reporting: Agencies)