Business Irish

Sunday 20 August 2017

Apple shares hold steady as investors shrug off concerns

Traders work on the floor of the New York Stock Exchange (NYSE)
Traders work on the floor of the New York Stock Exchange (NYSE)

Shares in Apple rose in New York as investors shrugged off concerns about the company's impending tax bill of up to €19bn to the Government.

The company's share price was up 0.46pc late yesterday despite the European Commission's ruling against the US tech giant earlier this week.

Finance Minister Michael Noonan has recommended lodging an appeal, saying he "disagreed profoundly" with what he called a bizarre order from the Commission that the US tech giant should hand over unpaid taxes to Ireland.

In Germany, the DAX was down 0.4pc after it emerged that two of the country's biggest banks, Deutsche and Commerzbank, had put planned merger talks on hold.

Meanwhile, European Union policymakers clashed yesterday over whether to cut a benchmark used by insurers to value billions of euro in liabilities to better reflect very low central bank interest rates.

New "Solvency II" rules for insurers in the 28-country bloc were introduced in January and include an "ultimate forward rate" or UFR, an interest rate for discounting liabilities which go out more than 20 years.

It was set at 4.2pc, reflecting interest rate expectations in 2010, before the financial crisis prompted central banks to slash rates to negative territory in some cases.

On currency markets, sterling rose yesterday, boosted by improved consumer confidence and rising British house prices in August, signalling that the economy is holding up well in the wake of the Brexit vote.

"Overnight, we saw UK August consumer confidence bouncing back," Morgan Stanley chief strategist Hans Redeker said.

He added that he remained bullish on the pound in the short term.

"Our bullish sterling case is more of tactical nature based on better UK data readings. Upcoming PMI data should show a bounce back."

Meanwhile, UK mortgage lender Nationwide said yesterday that British house prices rose 5.6pc in August compared with the same month last year, faster than July's 5.2pc.

Manufacturing, construction and services sector purchasing managers' surveys will be released at the start of September and many expect activity to bounce back a bit from the Brexit shock.

In Dublin, the ISEQ overall index of Irish shares was down 39.11 points at 6163.66, a drop of 0.63pc.

On the commodities markets, oil prices tumbled to more than two-week lows, with US crude falling more than 3pc.

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