Mining giants end plans for tie-up, while ECB decides to keep interest rates steady
In Dublin, bank shares were also hit badly.
Markets were also bruised as a planned €220bn tie-up between mining giants Glencore and Rio Tinto was shelved. The pair have had a long-running, on-off engagement that has seen them try to tie the knot before.
“Many wondered whether it might be third time lucky when Rio Tinto and Glencore got back around the table to discuss a deal which would have created the world’s biggest mining company – but today it emerged it was not to be,” Danni Hewson, head of financial analysis at AJ Bell, said yesterday.
“It had been thought that Rio Tinto’s new CEO might bridge the cultural differences between the two companies and succeed in getting the mega merger over the line. But with so much at stake and shareholders to appease, it seems ultimately the magic number couldn’t be found, at least not right now.”
The UK’s FTSE-100 closed down 0.9pc, while Germany’s DAX was just under 0.5pc lower.
Other indices in Europe also declined. Spain’s IBEX-35 was down almost 2pc. Denmark’s OMXC-25 was nearly 2.6pc lower.
In Ireland, the ISEQ-20 also shed nearly 2.6pc compared with Wednesday’s close. Shares in Bank of Ireland slumped 5.5pc to €16.68. AIB was 4.5pc lower, at €9.32.
Ryanair saw its shares decline 2pc to €28.26. There were few gainers. FBD Holdings advanced 1.8pc to €16.50.
The Bank of England and the European Central Bank (ECB) both kept rates steady yesterday. The eurozone’s central bank has been on hold since ending a year-long run of rate cuts in June, and surprisingly resilient growth coupled with easing price pressures have taken nearly all pressure off policymakers to provide any further support.
European Central Bank president Christine Lagarde. Photo: Bloomberg
In a statement, the ECB acknowledged continued uncertainties around global trade policy and geopolitical tensions but said an updated assessment still saw inflation stabilising at its 2pc target in the medium term.
“We are in a broadly balanced situation at the moment,” ECB president Christine Lagarde told a press conference. She said monetary policy remained in a “good place”.
Asked what impact on its outlook last week’s dollar tumble and rebound might have, Ms Lagarde said the rate-setting Governing Council had discussed the matter but noted that dollar depreciation was not new and went back as far as March 2025.
Today’s News in 90 seconds – Friday, February 6
The S&P 500 dropped to an over two-week low and the Nasdaq sank to its lowest level in more than two months by lunchtime yesterday in New York.
The decline came as the AI theme came under renewed pressure after Alphabet’s spending plans and chip maker Qualcomm’s downbeat forecast rattled investors.
Shares of Alphabet fell 4.2pc after the Google parent said it would double its capital expenditure this year, signalling another aggressive push to strengthen its position in the AI race. Qualcomm slid 8.2pc after forecasting second-quarter revenue and profit below estimates.
Additional reporting: Reuters
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