Wednesday 16 January 2019

European bourses higher as focus shifts

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

European bourses edged slightly higher yesterday, with attention gradually shifting from the earnings season to monetary policy and politics this week with Italy's general election next Sunday.

ECB President Mario Draghi made a speech at the European Parliament yesterday, while the new Federal Reserve chairman, Jerome Powell, is to give his first testimony at the US Congress today.

Mr Draghi said that slack in the eurozone economy may be bigger than previously estimated and this could slow the rise of inflation, but only temporarily, and prices will eventually climb.

His comments suggest the ECB remains confident that inflation is finally on an upward trend, supporting market expectations for the bank to finally end its bond purchase program this year.

In Ireland, the ISEQ Overall Index rose 0.24pc to 6,738.27.

The main focus was Bank of Ireland, with full-year results that disappointed analysts in terms of the net interest margin guidance for 2018.

Shares in the group fell 3.3pc to €7.54.

The results also weighed on AIB, with its shares falling 1.3pc to €5.16.

AIB releases its full-year results on Thursday. Insurer FBD, which releases results today, fell 2.3pc to €10.45.

Gainers included Glanbia, which advanced 2.2pc to €14.73, while hotel group Dalata was 1.4pc higher at €5.78.

The UK's FTSE-100 was up 0.62pc, while Germany's DAX rose 0.35pc France's CAC-40 was 0.51pc higher.

In the UK, shares in Associated British Foods were also among top gainers, up 3.1pc, after the Primark owner gave an update which forecast total first-half sales at Primark up around 7pc at constant currency rates, though the group was held back by a reduction in sugar revenues.


Irish Independent

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