European stocks up to a six-year high
Positive sentiment in Spain after Moody’s raises sovereign debt rating
Spanish stocks rose 0.9 per cent after Moody’s raised Spain’s sovereign debt rating one notch to Baa2 with a “positive” outlook. Photograph: Scott Eells/Bloomberg
A slide in HSBC shares failed to halt the upward momentum of the London market yesterday as the FTSE 100 Index moved closer to a record high. There was positive sentiment in Spain after Moody’s raised its sovereign debt rating and in Germany there was also positive news on the sentiment front.
In the US, stocks jumped 1 per cent with the S&P 500 climbing to an all-time high as optimism over merger activity helped Wall Street erase this year’s early weakness. In Dublin the Iseq finished the day up 1 per cent.
Kingspan, the provider of insulation solutions, said its sales rose by 10 per cent in 2013, to €1.79 billion, as the group benefited from “significant contributions” from its recent acquisitions. Earnings (Ebitda) were also 10 per cent ahead at €162.9 million for 2013, and the group reported a 19 per cent boost in its profit after tax, which jumped up to €89.2 million. Earnings per share advanced by 18 per cent to 51.7 cent.
The stock closed yesterday at €14.40, a rise of 3.23 per cent.
Revenues at Aer Lingus advanced by 2.3 per cent to €1.4 billion in 2013, as a strong performance from the group’s long-haul division offset the impact of good weather on short-haul travel. However, profits before tax slid back by 2.2 per cent to €39.5 million. The stock closed yesterday at €1.56, a fall of 2.74 per cent.
Bank of Ireland closed up 3.7 per cent, at 36 cent, while INM closed at 16 cent, a rise of 3.77 per cent.
Multinational food giant Kerry Group and building materials company CRH are both expected to report full-year results today. CRH was up 1.37 per cent at close yesterday, at €20.37, while Kerry rose by 0.83 per cent, to €52.03.
UK stocks rose, with the FTSE 100 Index reaching its highest level since December 1999, while HSBC Holdings posted profit that missed analysts’ estimates. The FTSE 100 Index rose 27.8 points, or 0.4 per cent, to 6,865.86 at the close in London. The gauge had earlier fallen as much as 0.6 per cent before rallying in the final hour of trading. The FTSE All-Share Index gained 0.4 per cent.
The banking giant HSBC finished 3 per cent lower after a 9 per cent rise in annual profits to $22.6 billion failed to meet the lofty forecasts of the City.
Dixons Retail rallied 6.7 per cent to 50.3 pence. A merger of the largest UK consumer-electronics retailer and Carphone Warehouse would bring together companies with combined revenue of about £12 billion. Discussions are at a preliminary stage and there is no certainty of a transaction taking place, the companies said in a statement. Carphone jumped 8.8 per cent to 333 pence.
European stocks advanced to a six-year high as companies rallied amid heightened mergers-and-acquisitions activity. Demand for Spanish equities helped European shares to extend their rally. Spanish stocks rose 0.9 per cent after Moody’s raised Spain’s sovereign debt rating one notch to Baa2 with a “positive” outlook. France’s CAC 40 rose 0.9 per cent, for its highest level since September 2008. Germany’s DAX increased 0.5 per cent.
Scania surged 32 per cent to 194.5 kronor. Volkswagen, which controls a majority of Scania’s shares and 89.2 per cent of voting rights, said on Friday it is offering 200 kronor per share for the remaining stock. Preferred shares of Volkswagen fell 6.5 per cent to €187.90, its biggest drop in a year.
Stocks on Wall Street surged to an all-time high on optimism over merger activity that also lifted global equities markets, while crude oil prices rose, helped by expectations of revived growth in the demand for oil. US stocks advanced in a broad rally, pushing the benchmark S&P 500 to a record as the Nasdaq punched to a new high for 2014 and levels last seen almost 14 years ago, when the technology bubble was imploding.– (Additional reporting, Bloomberg, Reuter)