Appetite for financials lifts markets

A rising tide carried stocks higher after initial losses yesterday, helped by Wednesday’s strong numbers from JP Morgan and Goldman Sachs. Encouraging news on US housing starts also helped, as did positive retail numbers in Europe.

DUBLIN

Irish shares held their own, although volumes were fairly patchy. The Iseq closed 0.74 per cent stronger at 3487.51, helped in large part by the financials.

Bank of Ireland had a good day, rising by 0.2 cent to 14.2 cent. It might not seem like much compared to historic highs, but the stock has not reached this level in almost a year. Dealers reported strong interest from investors seeking a proxy for the Irish economy.

FBD was also strong, adding 25 cent to finish at €10.85. Permanent TSB rose by 0.1 cent to 4 cent, and IFG was busy at €1.35 before closing unchanged at that level.

Grafton was a solid performer in advance of a Davy-led investor visit to Slough in England today. Shares climbed by 12 cent to €4.28.

Smurfit Kappa had a decent day amid reports of higher prices for containerboard. The group rose by 1 cent to €9.96.

Market heavyweight CRH pushed ahead again, adding 7.5 cent to reach €14.805.

In exploration, Aminex was unchanged at 5 cent after saying it had agreed a new $8 million loan. Dragon Oil said it had reached a two-year agreement with Socar Trading for the sale of its export production via Baku in Azerbaijan. Shares fell by 8.9 cent to €6.874.

LONDON

The UK’s blue-chip shares reversed early losses to hit a 4½-year high yesterday after several big fallers bounced back to expunge sellers from the market.

Banks were up nearly 2.5 per cent since the previous session’s lows, boosted by forecast-beating earnings from JPMorgan Chase and Goldman Sachs on Wednesday.

Appetite for banks was maintained despite hits to the profits of both Citigroup and Bank of America, while early selling pressure on Rio Tinto reduced dramatically throughout the day to lift the main weight on the index. The heavyweight miner had been down as much as 5 per cent after it announced a $14 billion non-cash impairment charge and the resignation of chief executive Tom Albanese. Rio closed only 0.5 per cent lower.

The FTSE 100 closed up 28.38 at 6,132.36, its highest close since May, 2008.

Of Irish interest was the appointment of Heather Ann McSharry, former managing director of Reckitt Benckiser and John Warren, former group finance director of United Biscuits and chairman of Uniq, to the board of Greencore.

EUROPE

European stocks gained the most in a week as retailers climbed on increased revenue and US housing starts jumped more than forecast to a four-year high.

Carrefour, France’s biggest retailer, Delhaize Group, the Belgian owner of Food Lion supermarkets, and Associated British Foods advanced more than 3 per cent.

Petropavlovsk surged the most in four months after the gold producer reported better-than-forecast output.

SAP fell 1.5 per cent as Citigroup lowered its recommendation on the shares.

US

US stocks rose, sending the Standard and Poor’s 500 index to a five-year high, amid better- than-forecast initial jobless claims and housing data.

A measure of homebuilders in SP indexes jumped 2.1 per cent and was poised for the highest closing level since 2007.

EBay, operator of the world’s largest online marketplace, increased 2.9 per cent as revenue topped some analysts’ estimates. BlackRock, the world’s biggest money manager, added 4.2 per cent as earnings increased 24 per cent and the firm boosted its dividend and share buy-back programme. – (Additional reporting: Reuters/Bloomberg)