European stocks hover close to three-month highs

European stocks remained close to three-month highs at the prospect of new stimulus measures in the region when the European Central Bank meets on Thursday. Weaker-than-expected euro zone inflation data further underpinned hopes for central bank action.

In the US, Federal Reserve chairwoman Janet Yellen said she was "looking forward" to a US interest rate rise that will be seen as a testament to the economy's recovery from recession. Investors will be on the lookout for further hints on Fed policy from Yellen when she testifies before Congress on Thursday.

Dublin

The Iseq climbed 0.6 per cent, with the market pulled upwards by

Ryanair

. The stock led gains for airline stocks across Europe, with its shares advancing 2.5 per cent to €14.54 on the day. The airline began the session on an upward trajectory and overcame a late-morning dip to finish strongly.

Building materials group CRH traded up on the previous day’s closing price for most of the day, but finished down slightly at €27.89, which was 0.2 per cent lower.

Paddy Power, which agreed to merge with Betfair in September, added 1.1 per cent to finish at €121.20, a new closing high for the stock, while insulation maker Kingspan rose 1.6 per cent to €25.63.

It was a broadly positive session for Dublin-listed shares, but AIB, Total Produce and Origin Enterprises slipped back.

London

The FTSE 100 rose as pharmaceutical stocks gained on recommendations by bullish brokers, while software company

Sage

clawed back losses prompted by its reporting results. The index of blue-chip shares was up 0.4 per cent at the close of markets.

Drugmakers GlaxoSmithKline, AstraZeneca and Shire together contributed the most to gains after the sector was boosted by a positive analyst’s note from investment bank Morgan Stanley.

Sage led declines earlier in the trading session, yet recovered to trade up 0.1 per cent.

Shares in engineering firm Meggitt fell 3.1 per cent, with analysts citing the possible impact of an expected reshuffle of the FTSE 100 index.

Mining companies Anglo American, Rio Tinto and Glencore were at the bottom of the index, down between 1 per cent to 2.2 per cent following a decline in copper prices on a stronger dollar and worries over demand in China.

Europe

The FTSEurofirst 300 index closed near three-month highs after edging up 0.01 per cent, but the euro zone’s blue-chip Euro Stoxx50 fell 0.2 per cent as profit-taking kicked in.

The hopes for a boost today courtesy of ECB president Mario Draghi had initially lifted Germany's Dax, France's Cac 40 and Spain's Ibex, but all three had run out of steam as the start of US trading approached, with the Dax trading down 0.6 per cent.

Healthcare stocks were among the top gainers across European markets. Swiss healthcare company Roche rose 1 per cent after Citigroup upgraded its stock to “buy” from “hold”, while Morgan Stanley raised its targets on both Roche and the London-listed GlaxoSmithKline.

US

US stocks slipped as energy shares retreated with oil prices. Fed chair Yellen signalled increased confidence in the economy, paving the way for a December rate increase. Equities remained lower following her comments, with energy producers in the S&P 500 slumping 2.6 per cent.

Qualcomm gained 7.3 per cent to help lift technology shares after signing a patent licensing agreement with Chinese smartphone company Xiaomi.

Yahoo! rose 6.6 per cent after the Wall Street Journal reported the board will consider a potential sale of the company's main internet businesses.

Microsoft added 1 per cent to reach a more than 15-year high. – (Additional reporting: Bloomberg / Reuters)