Business World

Thursday 22 March 2018

Poor US jobs growth hits markets around the world

Donal O'Donovan

WORSE than expected jobless numbers in the US prompted falls in stock markets around the world yesterday with the ISEQ index of Irish shares closing down close to half of one per cent. The ISEQ index closed down .40pc at 2,741.27.

Stocks erased an earlier advance after payrolls in the world's largest economy rose 39,000 last month, less than the most pessimistic projection of economists surveyed by Bloomberg News. The jobless rate increased to 9.8pc, the highest since April.

The US non-farm payroll report showed just 39,000 new jobs were created in the US in November compared to 172,000 in October.

In Ireland more local concerns saw Aer Lingus shares significantly underperform the index, down 2.47pc to €1.065 per share as the persistent bad weather caused disruptions to flights. Ryanair shares dropped 1.7pc to €3.850 each, on the same concerns, even though it announced a 2pc increase in passenger numbers in the last 12 months yesterday.

Shares in Irish Life and Permanent fell 6.7pc and dropped below the €1 mark to close the day at 97 cent each. The fall reverses gains that came after the banking and insurance group said it would not need government funds to meet new capital requirements.

Despite last night's fall the shares were up by close to 100pc over the closing price of 51 cent each a week earlier.

Shares in the main banks AIB and Bank of Ireland were largely unchanged yesterday.

That compared well to the UK where a number of financial stocks were under pressure.

UK shares fell after the US non-farm payroll job figures were announced at midday. A decline in the FTSE 100 index of the biggest UK companies yesterday took the edge off what was still the first week-on-week increase in a month.

In the UK, financial stocks were under pressure with Man Group, a hedge-fund manager, falling 3.3pc to 279.1 pence, losing a third of the previous three days' gains. Barclays fell 2.5pc to 268 pence and Old Mutual, the UK's third-largest insurer by market value, climbed 2.5pc to 120.1 pence.

The pan European Stoxx 600 index fell in line with the FTSE and ISEQ down 0.3pc to 270.94.

Across Europe Germany's DAX Index declined 0.1pc and France's CAC 40 Index was up 0.1pc.

Irish Independent

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