Monday 22 January 2018

European shares edge higher but gold falls

The news sent GM's shares up more than 1pc in pre-market trading
The news sent GM's shares up more than 1pc in pre-market trading

European shares had edged higher by early afternoon yesterday, but gold fell as questions hung over the 'reflation' trades that had lifted markets since Donald Trump became US president.Sterling held near a six-month high after Theresa May called a snap election on Tuesday.

Wall Street opened higher as corporate earnings took centre stage and Morgan Stanley reported a surge in quarterly profits.

Yields on safe-haven government bonds rose, the safe-haven yen fell and copper surged as some in markets suggested investors' worries over the coming weekend's French presidential election first round and still simmering tensions over North Korea appeared to ease somewhat.

There are now just three days before the first round of voting in France, and only a few points separate the top four candidates, including two who oppose the euro - the far right's Marine Le Pen and the far left's Jean-Luc Melenchon.

"There were probably some nerves around the prospect of Melenchon making it into the final round, potentially even along with Le Pen, but that does seem to have faded," said Richard Benson, co-head of portfolio investment with currency fund Millennium Global in London.

In Ireland, the ISEQ Overall Index was 0.6pc higher at 6,714.33 by mid-afternoon, helping it to erase the slight decline it posted on Tuesday.

Shares in CRH had risen just over 1pc to €31.60, while ferry operator Irish Continental was also just more than 1pc higher, at €5.36. The ferry company is tapping the European Investment Bank for a €75m loan to help fund the construction of a new vessel it ordered last year.

Shares in biotech investment firm Malin were down 2.9pc at €9.95. The company is headed by former Elan boss Kelly Martin. Mining equipment manufacturer and supplier Mincon was 2pc lower at €1.00.

The UK's FTSE-100 had slipped 0.2pc by mid-afternoon, while Germany's DAX was 0.2pc higher. France's CAC-40 was up 0.3pc.

British luxury group Burberry was the top European faller, down 7.pc before the close after it reported a slight slowdown in fourth-quarter comparable sales growth rate, saying tough conditions in the US outweighed 'exceptional' performance in its home market where tourists took advantage of the weaker pound.

Shares in Primark owner Associated British Foods nudged 0.5pc higher after it reported solid first-half results.

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