Saturday 24 March 2018

Global stocks hit record highs, but sterling falls

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

Global stocks hit record highs yesterday, topping 2016's gains just two months into 2017, while the dollar rose before Federal Reserve minutes that will be scoured for clues about the next US interest rate rise.

European shares also climbed to a new 14-month high, supported by well-received earnings updates from companies such as Lloyds, Telefonica Deutschland and Scor.

MSCI's main index of global stocks, which tracks share prices across 46 countries, hit a second successive record high. It has risen some 5.7pc so far this year, beating the 5.6pc gains of 2016.

Sterling fell after data showed UK business investment fell in the fourth quarter of 2016 and indicated tougher economic times lie ahead, despite overall growth hitting its fastest rate in a year.

Business investment fell 1pc in the last three months of the year compared with the previous quarter, the first fall since the start of the year.

Household spending growth in the UK also slowed, and separate data showed the services sector expanded in December at the slowest pace in seven months.

In Ireland, the ISEQ Overall Index was 0.38pc lower at 6,601.46 by late afternoon.

Movers included Glanbia, which was almost 5pc higher at €18.15.

It reported strong full-year results and also announced plans to create a new joint venture with Glanbia Co-op.

Shares in Bank of Ireland, which releases full-year results tomorrow, were unchanged at 23 cent.

Shares in a number of companies declined, with packaging giant Smurfit Kappa down 2.1pc at €25.65, and CRH 1.2pc lower at €32.89.

The UK's FTSE-100 was 0.2pc higher, while Germany's DAX was also up 0.2pc. France's CAC-40 was 0.3pc lower.

Telefonica Deutschland was one of the best-performing stocks, up 5.8pc after it reported better-than-predicted core profit for the fourth quarter and raised its target for synergies from its acquisition of E-Plus.

ThyssenKrupp was also a top gainer, up 5.4pc near the open after the German industrials and steel company said it had sold its Brazilian steel mill to Ternium, ending five years of unsuccessful efforts by the German company to exit Latin America's largest economy.

Banking and insurance stocks were the top-performing European sectors.

Lloyds was a top gainer, adding 3.5pc after impressing investors with profits rising to a 10-year high.

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