Worrying US manufacturing figures fan fears of slowing growth

European shares ended a three-day winning streak on Tuesday as investors were gripped by growth worries after poor US manufacturing data fanned fears of slowing growth in the world’s largest economy. That contributed to deepening worries about the impact of a US-China trade war, and saw Wall Street’s main indices reverse course.

DUBLIN

Dublin’s Iseq all-share index dipped 0.26 per cent on Tuesday, ending a four-day winning streak, with little in the way of big movers except among penny stocks.

There was also little newsflow on the day with the exception of oil and gas explorer Providence Resources, which told the stock exchange that it had not received a $9 million loan from its Chinese backer Apec and was therefore free to open up commercial discussions for a licence with third parties. The company's shares fell 25.33 per cent to €0.04 on the news.

Ryanair, meanwhile, advanced 2.32 per cent to €10.80 after a price target upgrade by Bank of America Merrill Lynch. Comments from chief executive Michael O'Leary suggesting that Brexit would have no long-term impact on the company also buoyed the stock.

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Index heavyweight CRH was another mover on the day, dipping 1.87 per cent to €31 after an economic measure of US manufacturing fell to a 10-year low. The factory gauge reading fell to its weakest since the last global recession.

LONDON

Losses in London’s FTSE 100 were limited by a drop in the pound ahead of prime minister Boris Johnson’s presentation of proposals for an amended Brexit agreement. A weakness in the sterling tends to bode well for exporters in the index.

British baker Greggs, which has four outlets in Ireland, slid 12.5 per cent after it reported slower quarterly sales growth and warned of rising cost pressures. The retailer also said that it expected fewer shop openings by the end of the year than previously forecast as it revealed a slowdown in sales growth in the third quarter.

Plumbing giant Ferguson saw shares jump higher after it reported a rise in annual profits as it gears up to spin off the UK business. The group surged to the top of the FTSE 100 as shares lifted 6 per cent after reporting an 11.5 per cent hike in pre-tax profits.

EUROPE

The pan-European STOXX 600 index touched session lows, and closed down 1.3 per cent. All major sectors in Europe moved well into the red, with German and French stocks losing more than 1 per cent each.

Adding to the gloomy mood, stocks with exposure to Hong Kong and Asia, such as Standard Chartered, HSBC and Louis Vuitton owner LVMH, lost between 0.8 per cent and 2.5 per cent.

Healthcare stocks also slid, with shares of AstraZeneca down 1.7 per cent after the US Food and Drug Administration denied approval to the smoker's lung treatment developed by the drugmaker.

Airlines were a bright spot, with International Consolidated Airlines and Air France-KLM rallying after Bank of America Merrill Lynch reinstated a "buy" rating on the stocks and gave a positive outlook for the sector.

NEW YORK

McDonald's dropped 2.5 per cent after JP Morgan said the fast food chain's third-quarter same-store sales would be softer than analysts' estimates.

Shares of online brokerage E*Trade Financial tumbled 17.9 per cent, the most on the S&P 500, following rival Charles Schwab's move to remove commissions for online trading of stocks, ETFs and options listed on US or Canadian exchanges. Shares of Charles Schwab dropped 9.5 per cent.

Semiconductor stocks Analog Devices and Microchip Technology rose after KeyBanc upgraded the chipmakers to "overweight".

Ulta Beauty advanced 5.8 per cent as singer Jennifer Lopez launched a new fragrance exclusively at the company's stores in the US and an independent director bought back shares.

– Additional reporting: Reuters