Ireland outperforms European peers
IRELAND OUTPERFORMED its peers in Europe yesterday to close up 1.26 per cent. The UK’s FTSE, France’s CAC and Germany’s DAX all slid, while the Stoxx Europe Index also ended up in the negative.
Global and European markets were affected by weak manufacturing data from China and crisis worries.
Ireland, meanwhile, received a boost after government nine-year bond yields fell below 5 per cent for the first time since before the EU-IMF bailout.
IRELAND WAS the shining light on the markets yesterday, “massively overperforming”, according to one Dublin stockbroker.
He said the equity markets were most likely helped by the Irish bond market, which performed very well.
The Dublin market was also boosted by index heavyweights CRH, Paddy Power and Kerry all ending up positive, rising 1.74 per cent, 2.63 per cent and 4.42 per cent respectively.
Dragon Oil also closed up, jumping 3.09 per cent to €7.62, while Ryanair rose 2.28 per cent to €4.48. The Irish Aviation Authority yesterday found that three Ryanair planes which had to make emergency landings due to low fuel had sufficient fuel for their flight plan.
Kingspan was the big loser of the day, falling 3.58 per cent to €7.81. However, trading volumes were light.
Smurfit Kappa finished up 2.6 per cent to €7.80 at close of markets yesterday. The global packaging group climbed more than 13 per cent on the Dublin market last Friday on the back of a large order from a single buyer. It closed down more or less flat in recent days, but yesterday started climbing again.
BRITAIN’S TOP share index wilted yesterday after economic data painted a bleak picture of prospects for a rebound in activity in the US, Europe and China, heightening concerns over company earnings and valuations.
Miners took most points off Britain’s leading share index, falling 2.4 per cent, in tandem with metal prices, after the weak data, in particular from resource hungry China, heaped pressure on the sector’s earnings outlook.
Anglo American and Lonmin dropped more than 4 per cent as a gauge of basic resources producers tumbled the most in three weeks.
Ocado sank 4.2 per cent after the online retailer’s sales missed analyst estimates.
Imperial Tobacco rallied the most in four months after raising its revenue forecast.
The FTSE 100 index lost 33.84 points, or 0.6 per cent, to 5,854.64 at the close of trading in London. The broader FTSE All-Share Index retreated 0.5 per cent yesterday.
“Equities are trading lower today as economic data highlighted that recent gains are not a true reflection of the state of the global economy,” said Craig Erlam, a market analyst at Alpari UK in London.
EUROPEAN STOCKS declined for the third time in four days after a report signalled that Chinese manufacturing will contract for an 11th month, adding to concern the global economic slowdown is deepening.
A gauge of mining companies posted the biggest drop of the 19 industry groups in the benchmark Stoxx Europe 600 index.
Daimler lost 2 per cent after saying earnings would fall at its Mercedes Benz cars business.
Telenet surged 13 per cent after Liberty Global made a $2.5 billion offer to buy the rest of the communications company.
The Stoxx 600 slipped 0.2 per cent to 274.5 at the close, while the Euro Stoxx 50 gauge of the biggest companies in the euro area dropped 0.6 per cent.
The Stoxx 600 has still climbed 17 per cent from this year’s low on June 4th as European Central Bank policy-makers agreed to implement an unlimited bond-buying programme and the Federal Reserve unveiled its third round of asset purchases.
US STOCKS declined, but were off session lows, as investors weighed sluggish economic figures from around the world against efforts by central banks to prop up their respective economies with strong stimulus measures.
Transportation stocks, sensitive to the nation’s economic fortunes, were among the worst performers, with the Dow Jones Transportation average down 2.7 per cent.
Railroad company Norfolk Southern said smaller shipments of coal and merchandise and lower fuel-surcharge revenue would crimp its third-quarter earnings compared with a year earlier. Its shares fell 8.8 per cent to $66.28.
Bed, Bath Beyond tumbled 8 per cent to $63.27 after the company posted quarterly results that narrowly missed Wall Street estimates on account of higher costs.
Fellow retailer JC Penney slumped 9.4 per cent to $26.36 after chief executive Ron Johnson said new shops within stores are doing much better than other parts of its department stores. – (Additional reporting: Bloomberg)