Saturday 21 April 2018

AIB shares plunge towards IPO target

A man monitors an electronic board displaying share market prices during a trading session in the halls of Pakistan Stock Exchange (PSX) in Karachi. Photo: Reuters
A man monitors an electronic board displaying share market prices during a trading session in the halls of Pakistan Stock Exchange (PSX) in Karachi. Photo: Reuters

Reuters

World stock markets recovered after a technology-led selloff and short-dated US bond yields hit multi-week peaks on Tuesday as investor focus turned to the Federal Reserve's monetary policy meeting.

At home, AIB shares fell almost 14pc to €5.60 each after a formal price range for the IPO of the State's 25pc stake pegged a price of between €3.90 and €4.90.

Technology shares edged higher after a two-session drop that put the spotlight on areas of the stock market where valuations appear stretched.

Big technology names like Microsoft and Alphabet helped prop up US stocks, though materials led sector gains. The S&P materials index was up 0.9pc, and the S&P energy index, which is this year's weakest-performing group, was up 0.6pc.

The US central bank is widely expected to raise its benchmark interest rate on Wednesday and may also provide details on its plans to shrink $4.5 trillion of assets it amassed to nurse the economic recovery.

Analysts say the Fed could take an aggressively hawkish posture of signalling a balance sheet reduction this year and another rate increase in December.

"Wednesday's meeting is pretty much a high-risk event," said Charles Comiskey, head of Treasuries trading at Bank of Nova Scotia in New York.

The Bank of Japan and the Bank of England also meet this week, although no major policy changes are expected.

The gap between benchmark US and European bond yields held near its widest in a month as the Fed meeting also shone a light on the slow pace of change in European Central Bank policy.

Closer to home the pan-European STOXX 600 was up 0.6pc, while MSCI's gauge of stocks across the globe was up 0.5pc. The ISEQ index of Irish shares rose 0.8pc to 7,008.

Irish Independent

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