Debt-crisis optimism drives markets

MARKETS ACROSS Europe advanced yesterday, against a background of growing optimism that Europe’s sovereign debt crisis will be resolved.

In the US, mixed economic signals kept markets flat.

DUBLIN

IN LINE with markets around Europe, the Iseq enjoyed another bounce yesterday, climbing by almost 1 per cent to extend its gains further.

As one broker put it, “there isn’t a bad day around at the moment”, while another said, “it’s nice to have some normality return to the Irish market”.

Strongest on the day was Irish Life Permanent, which was up by 9.3 per cent to €0.05.

Airlines were also up on the day, with Aer Lingus one of the strongest performers, adding 4 cent, or 4.8 per cent, to finish the day up at €0.88.

Noting that it had sold off on the previous day due to investors expecting a decision on a special dividend, one broker said that interest came back in the stock yesterday.

Meanwhile, one broker speculated that Ryanair is in the market buying back shares.

It was up by 9 cent, or 2.2 per cent yesterday, advancing to €4.20. If this is the case, then it’s just another reason to hold the stock, he noted.

Fyffes got a good response from the market for its results, and it added 1 cent to advance by 2.4 per cent to €0.42.

After a good set of results earlier in the week from Kingspan, it held up yesterday, adding 5 cent, or 0.6 per cent, to climb to €8.15.

Similarly, CRH gained 24 cent to advance by 1.5 per cent to €16.28, albeit on lower volumes since it moved its main listing to London.

There were few stocks in the red yesterday.

Independent News Media gave up 0.7 per cent to close down at €0.27, while food group Aryzta slid back by 20 cent, or 0.5 per cent, to finish down at € 37.30.

Total Produce was one of the weakest, losing almost 1 cent, or 1.8 per cent, to fall back to €0.45

LONDON

IN LONDON, UK stocks advanced once more, making up for the previous day’s sell-off, as positive UK manufacturing data indicated that the economy hasn’t yet slipped back into recession.

The FTSE 100 gained 1 per cent to climb to 5,931.25.

Advertising group WPP forecast higher revenue and gained 3 per cent to 827.50p after it said that revenue from continuing businesses will grow 4 per cent this year as the London Olympics and US presidential elections buoy the industry.

Hedge fund manager Man Group jumped 13 per cent to 147.50p, after it reported an increase in assets under management to 1.9 per cent in the first two months of 2012, stemming last year’s decline.

Cable and Wireless Worldwide surged 15 per cent to 31.98p after Indian company Tata Communications Ltd said it may make a cash offer, although talks are at a very preliminary stage.

“There are a number of positives today: WPP has had a very strong year, which augurs well for the future and Man Group are starting to recover some of the business they recently lost,” explained Richard Hunter, head of UK equities at Hargreaves Lansdown.

EUROPE

IT WAS another good day across Europe, as the Stoxx Europe 600 Index continues to enjoy its best start to a year since 1998.

The Stoxx 600 advanced by 1 per cent to 267.06 at the close, as optimism mounted that the euro area will contain its sovereign-debt crisis.

National benchmark indexes climbed in all of the 18 western-European markets, except Norway.

Germany’s DAX index rose by 1.3 per cent, while France’s CAC 40 index gained 1.4 per cent.

Veolia Environment jumped 15 per cent to €10.55, the largest gain on the Stoxx 600, after saying it is in exclusive talks to sell Transdev, its mass-transit unit.

Adecco, the world’s largest provider of temporary workers, surged 8.5 per cent to 49.18 Swiss francs, as it increased its dividend by 64 per cent to 1.80 francs a share.

US

IN THE US, there were mixed economic signals. US manufacturing unexpectedly slowed in February, while consumer spending was static in January for the third straight month.

However, US car makers posted stronger auto sales in February, helped by the need to replace aging cars and trucks despite rising fuel prices.

In addition, many retail chains reported stronger-than-expected gains in same-store sales

Near the close of trading, the Dow Jones Industrial Average was up 13.85 points, or 0.11 per cent, at 12,965.92.

The SP 500 was up 6.23 points, or 0.46 per cent, at 1,371.91.

And the Nasdaq Composite index was up 21.49 points, or 0.72 per cent, at 2,988.38.