stock markets

Tech shares regain mojo but LVMH tiff takes Tiffany down

Agence France-Presse, Agence France-Presse
Large tech companies such as Apple and Amazon are back on offense on Wednesday, September 9, but shares of iconic jeweler Tiffany tumble as its deal with LVMH collapses

Equities rose on both sides of the Atlantic on Wednesday, September 9, with United States tech shares regaining their mojo even as iconic American jeweler Tiffany slumped on news its buyout by France’s LVMH was called off.

The tech-rich Nasdaq led major Wall Street indices higher after being at the center of a 3-day pullback that shaved 10% from the index following a record on September 2.

But Tiffany shares tumbled after French luxury group LVMH said it was withdrawing from a $16.2-billion acquisition which would have been the biggest ever in the luxury industry. LVMH blamed arguments over deal-closing deadlines and threatened US tariffs on French goods, while Tiffany filed a lawsuit against the French company in a US court.

At the close in Europe, London’s benchmark FTSE 100 gained 1.4%, helped by the struggling pound.

“Stock markets are back in rally mode as investors look to get back to their ‘buy the dip’ ways that proved so successful over the past few months,” said Chris Beauchamp, chief market analyst at IG.

Shares in British pharmaceutical group AstraZeneca limited losses to 0.5% after the company “voluntarily paused” a randomized clinical trial of its coronavirus vaccine, in what it called a routine action after a volunteer developed an unexplained illness.

The company, which is developing the drug alongside the University of Oxford, is a frontrunner in the global race for a COVID-19 vaccine. 

Sterling remained under pressure on fears Britain will fail to strike a post-Brexit trade deal with the European Union as the euro barreled still higher to 91.09 pence to the pound before settling back below the 91-pence mark. Sterling also got down to a 6-week low against the dollar at $1.2919 before coming back somewhat.

Tech ticks up

Oil prices rebounded slightly, meanwhile, from recent sharp losses.

Large tech companies such as Apple and Amazon were back on offense after the 3-day retreat caused by profit-taking and concerns the firms that have prospered during the pandemic have risen too far, too fast. 

But Gregori Volokhine, portfolio manager at Meeschaert financial Services, said the reversal was too indiscriminate.

“You can’t put all the companies in the same basket,” said Volokhine, who said that some valuations such as Tesla’s had gotten out of control.

“But you can’t say the gains of companies like Apple and Microsoft have really lost a link to reality,” he added.

Key figures around 8:40 pm GMT
  • New York – Dow: UP 1.6% at 27,940.47 (close)
  • New York – S&P 500: UP 2% at 3,398.96 (close)
  • New York – Nasdaq: UP 2.7% at 11,141.56 (close)
  • London – FTSE 100: UP 1.4% at 6,012.84 (close)
  • Frankfurt – DAX 30: UP 2.1% at 13,237.21 (close)
  • Paris – CAC 40: UP 1.4% at 5,042.98 (close)
  • EURO STOXX 50: UP 1.8% at 3,324.83 (close) 
  • Tokyo – Nikkei 225: DOWN 1% at 23,032.54 (close)
  • Hong Kong – Hang Seng: DOWN 0.6% at 24,468.93 (close)
  • Shanghai – Composite: DOWN 1.9% at 3,254.63 (close) 
  • Pound/dollar: UP at $1.3000 from $1.2982 at 9 pm GMT
  • Euro/pound: UP at 90.80 pence from 90.72 pence
  • Euro/dollar: UP at $1.1805 from $1.1778
  • Dollar/yen: UP at 106.12 yen from 106.03 yen 
  • West Texas Intermediate: UP 3.5% at $38.05 per barrel
  • Brent North Sea crude: UP 2.5% at $40.79 per barrel

– Rappler.com