Monday 22 January 2018

Investors still spooked by China as stocks slide

Traders work on the floor of the New York Stock Exchange. Photo: Reuters
Traders work on the floor of the New York Stock Exchange. Photo: Reuters

Stockmarkets around Europe fell yesterday, with continuing concerns about the health of the Chinese economy weighing on sentiment.

Figures showed that consumer inflation in China cooled more than expected in September.

Producer prices there also extended their slide for a 43rd month in a row, adding to concerns about deflationary pressures in the world's second-largest economy. The data came after figures earlier in the week showed that China's imports had slumped.

"In the short-term sentiment appears to have turned substantially negative again... Chinese inflation data has come in well below expectations overnight," said Markus Huber, senior analyst at Peregrine & Black.

In Ireland, the Overall ISEQ Index was down 0.35pc near the close, at 6,129.82.

Shares in Ireland's biggest firm, CRH, were among those hit, having shed 1.8pc, or 44 cent, to €23.43 shortly before the end of the session.

Ferry group Irish Continental was also stumbling, with its shares declining 3.3pc to €4.30 by the middle of the afternoon.

Gainers included insulation maker Kingspan, which was 1.3pc ahead at €20.94 shortly before the close. Shares in Smurfit Kappa fell again, sliding 2.5pc to €23.10 as the session drew to an end. The UK's FTSE-100 was almost 1pc lower yesterday, while Germany's DAX yielded nearly 1.1pc. France's CAC-40 was down 0.55pc.

In the UK housebuilders, including Taylor Wimpey and Persimmon, came under pressure, with some observers putting the declines down to profit taking after solid runs in the stocks.

Shares in Domino's Pizza soared as much as 14pc as it revealed strong third-quarter trading.

Pensions and investments group Hargreaves Lansdown gained after it reported an increase in new clients during its third quarter. Its shares were up about 3.5pc near the close.

That was despite the amount of funds it has under management falling.

Brokerage Numis described it as a "strong trading update" despite difficult market conditions.

"The group's scale benefits are substantial and unmatched providing it with by far the highest operating margin and the buying power to provide the cheapest fund prices in the market," Numis said in a note, raising its earning forecasts and rating the stock a "buy".

Shares in US firms were also trending down yesterday after retail giant Walmart forecast that its profits will fall next year. Shares in the firm slumped nearly 9pc.


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