Markets

Stock markets upbeat as Joe Biden inaugurated

Investors eye large US economic stimulus and infrastructure package

Wall Street enjoyed a rally after the inauguration of Joe Biden as the 46th president of the US. Photograph: Angela Weiss / AFP

Wed Jan 20 2021 - 18:50

European stocks rose on Wednesday after Dutch chip equipment maker ASML and Swiss luxury group Richemont published positive earnings updates, while investors eyed a large US stimulus plan as Joe Biden was sworn in as president.

Traders bet on a bigger pandemic relief plan and higher infrastructure spending by the new administration as it seeks to boost the pandemic-stricken American economy.

DUBLIN

The Iseq nudged up 0.1 per cent amid the positive mood for equities across Europe. Building materials group CRH, the largest stock on the Dublin market, ended 0.35 per cent higher at €36.92. The cement-maker has been buoyant of late due to expectations that it will be a key beneficiary of Biden's $1.9 trillion (€1.6 trillion) economic recovery plan.

Cardboard box-maker Smurfit Kappa added 0.6 per cent to finish the session at €40.46, while Paddy Power owner Flutter Entertainment advanced 0.9 per cent to €162.95.

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But it was a weaker day for Bank of Ireland, which slipped 0.6 per cent to €3.34, and Ryanair, which was 0.1 per cent lower at €15.56. Insulation-maker Kingspan fell 0.6 per cent to €63.50, while food groups Glanbia and Kerry both finished in the red, declining 0.3 per cent to €10.31 and 0.4 per cent to €112.00 respectively.

LONDON

The FTSE 100 joined in the upbeat mood following Biden’s inauguration, with the blue-chip index rising 0.4 per cent despite the impact of a soaring pound on the exporter-heavy market. Mid-caps on the FTSE 250, meanwhile, advanced 1.35 per cent.

Pub giant JD Wetherspoon saw shares rise more than 5 per cent to their highest level since March after it raised equity to shore up its finances and invest in new sites once Covid-19 restrictions are eased.

Electronics retailer Dixons Carphone drifted 3.3 per cent lower despite reporting a surge in online orders, while books and stationery retailer WH Smith soared 10.4 per cent after it said sales had outperformed expectations in the run up to Christmas.

Burberry jumped 3.9 per cent after it stuck to its full-year goals, saying higher full-price sales would boost annual margins, while Asian demand remained strong.

EUROPE

The pan-European Stoxx 600 index closed 0.7 per cent higher, getting an extra boost as Wall Street marked record highs.

Tech stocks rallied to a two-decade peak in Europe after ASML Holding rose 3 per cent to all-time highs on better-than-expected quarterly sales and a strong order intake for 2021.

Richemont rose 2.8 per cent, after posting a 5 per cent increase in quarterly sales as Chinese splashed out on Cartier, its flagship jewellery brand. The earnings from Richemont and Burberry had a knock-on effect on other luxury goods makers that are heavily reliant on China, with LVMH and Kering gaining between 1 per cent and 3 per cent.

In Germany, the Dax surged almost 0.8 per cent ahead, while in France the Cac 40 added 0.5 per cent. Italy's FTSE MIB gained 0.9 per cent after prime minister Giuseppe Conte won a confidence vote and averted a government collapse.

Daimler jumped 4.2 per cent after its Mercedes-Benz brand unveiled a new electric compact SUV, the EQA, as part of plans to take on rival Tesla.

Germany's Hugo Boss added 4.4 per cent after Mike Ashley-led Frasers boosted its stake in the company.

US

Wall Street stocks rallied in early trading as investors grew optimistic that recent federal spending will revive growth and bolster corporate earnings. The Nasdaq 100 index jumped 2 per cent and the S&P 500 Index rose to an all-time high.

Netflix surged more than 13 per cent after revealing a jump in subscribers above the 200 million threshold, while Morgan Stanley gained after reporting record full-year results.

Investors were keeping an eye on Washington, where Joe Biden was sworn in as president and delivered a call for unity. – Additional reporting: Reuters/Bloomberg

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