Shares in International Consolidated Airlines Group rose after the British Airways owner said it would pay its first dividend since the pandemic and reported earnings that beat analysts’ expectations. At 0702 GMT shares traded 2.75% higher to 164.40 pence, leading the FTSE 100. The aviation group - also known as IAG, whose carriers include Iberia and Vueling among others - said it would pay an interim dividend of 3 European cents a share. It is the company’s first payout since it suspended dividends in April 2020 during the pandemic. IAG said it would look to pay a regular dividend and to return any excess capital to shareholders going forward. “We think the reinstatement of the dividend indicates confidence in the prospects of the business,” RBC Capital Markets analyst Ruairi Cullinane said in a research note. The dividend comes off the back a strong set of results for IAG, Cullinane said. Operating profit before exceptional items - IAG’s preferred metric - came to €1.24 billion in the three months to the end of June, down 0.8% compared with the same period last year as costs rose faster than revenue mainly due to fuel expenses and wages. The result exceeded analysts’ estimates of €1.08 billion.

The Swiss stock market ended trading on Friday with massive losses. This was due to growing economic concerns following very weak US labor market data. The SMI lost 3.6 percent to 11,876 points. Of the 20 SMI stocks, there were 19 losers and 1 winner, Nestle. A total of 37.32 (previously: 21.09) million shares were traded. The main selling pressure was on economically sensitive stocks and technology shares. ABB, for example, fell sharply by 8.4 percent. Holcim (-6.9%), Sika (-6.9%) and Geberit (-5.4%) also recorded massive losses. The Logitech share was also deep in the red with losses of 7.7 percent. Financial stocks also fell sharply: UBS lost a whopping 9.5 percent and Partners Group 6.7 percent. The more defensive index heavyweights held up relatively well in the very weak environment. The shares of food giant Nestle even rose slightly by 0.3 percent. Among the pharmaceutical giants, Roche held up comparatively well, falling by 1.6 percent. Novartis fell somewhat more sharply with a drop of 2.0 percent.

European stock markets sold off on Friday following very weak US labor market data. The number of people in employment rose by only 114,000 in July, compared to expectations of 185,000. The unemployment rate also rose to 4.3%, which was also well above the forecast of 4.1%. The data underlined concerns about a recession in the USA. At the same time, the probability that the US Federal Reserve will cut interest rates more aggressively than previously expected increased. In the meantime, the possibility that the Fed will cut interest rates by 50 basis points in September is increasingly being priced in. The DAX lost 2.3 percent to 17,661 points, with the index hitting a low of 17,624, while the Euro-Stoxx-50 fell 2.7 percent to 4,639. On the German stock market, Infineon (-5.1%) and Süss Microtech (-10.1%) felt the impact. Chip and equipment manufacturers such as ASML fell 11.2 percent, BE Semiconductor dropped 9.3 percent and STMicro 5.8 percent. Among the biggest losers in the DAX were Siemens Energy, down 7.5 percent, while RWE fell 7.9 percent.

A summer swoon in the stock market intensified Friday after a disappointing jobs report renewed worries about slowing growth and drove a broad-based selloff. The tech-heavy Nasdaq Composite Index suffered a correction - a drop of more than 10% from its recent high on July 10. The yield on the 10-year Treasury note recorded its biggest weekly fall since March 2020, with investors fleeing stocks and diving into safer bets like government bonds. And the jitters sent a measure of stock volatility to its highest level of the year. For months, the U.S. economy appeared to be in a sweet spot, with inflation falling and the domestic economy humming along. Many investors started piling into corners of the market that are the most sensitive to the economy, wagering that the expansion has room to run and driving a mammoth stock rotation that lifted even beleaguered corners of the market. The tech-heavy Nasdaq dropped 2.4% Friday. The S&P 500 declined 1.8%, bringing its losses for the week to 2.1%, the worst weekly showing since April. The Dow Jones Industrial Average fell more than 900 points before paring some of those losses to end down 610.71 points, or 1.5%. It dropped 2.1% for the week. The indexes are up between 5.4% and 12.1% in 2024. The Fed left rates steady at its meeting this week but kept the window to a September cut open. Futures prices recently implied a more than 70% chance that the central bank cuts rates by half a percentage point at its September meeting. That is up from a roughly 28% probability before the jobs report was released. Shares of Citigroup, JPMorgan Chase and other banks tumbled as investors came to terms with a disappointing jobs report and what it means for the nation’s economy. Citigroup fell 7.1%, JPMorgan dropped 4.2% and Bank of America declined 4.9%. The volatility extended to markets around the globe. Japanese stocks plunged for two days after the country’s central bank took an unexpectedly hawkish turn Wednesday. The Topix index dropped 6.1% Friday, the largest decline since 2016, bringing its two-day loss to 9.2%. Some investors said the market is due for the bout of volatility that has emerged this summer, after a prolonged ascent that drove major indexes to repeated highs this year.

The stock markets in East Asia and Australia started the week with heavy losses in some cases. In Tokyo, the Nikkei index fell by 7.0 per cent to 33,389 points, a drop of around 2,600 points.

On the U.S. bond market, bond prices rose massively with the weak labor market data and the increased need for supposed security, and yields plummeted accordingly.

Citi lowers Easyjet target to GBP 4.80 (5.95) – Neutral
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