Optimism evident in global markets

Global markets advanced amid renewed optimism among investors that ultra-loose monetary conditions will continue.

DUBLIN The upbeat mood helped lift the Iseq index almost 3 per cent to 6,266.21 points, although one trader said conditions were akin to “bungee-jumping” as the Irish market took its lead from Europe.

“The main feature was positive September traffic statistics from Ryanair, up 12 per cent against expectation of 10 per cent, with a load factor 94 per cent,” the trader said. The airline’s stock gained 4.63 per cent to close at €13.46.

CRH took advantage of its global exposure to gain 2.9 per cent to finish at €23.75½ on “cyclical” market moves.

Kingspan added 1.87 per cent to €21.29 and Smurfit Kappa gained close to 1 per cent to close at €23.68.

“Volumes weren’t massive across the market but there was decent enough volume in Bank of Ireland,” according to the trader. Bank of Ireland rose 4.05 per cent to 36 cent.

“This was market driven as opposed to stock specific. European banks up 3½ per cent today. The rising tide has lifted all the boats here.” LONDON The London market surged led by reports that commodity giant Glencore is in talks to sell its agriculture business. The FTSE 100 Index was 169 points higher at 6299, in a market with no fallers, as the global equity volatility seen in recent weeks showed little sign of abating.

Under pressure trader and miner Glencore was up 21 per cent, or 20p, to 115p, after strong gains in Asia overnight sparked by reports that it was in talks to sell its agriculture unit, valued at around $10 billion. But in London the firm said it was “not aware of any reasons for these price and volume movements”.

The Swiss-based firm, which has lost around two-thirds of its value this year, recently pledged to investors to make disposals and cut its $30 billion debt mountain by a third.

Lloyds Banking Group was up 0.7p to 77.3p after chancellor George Osborne said the government would sell £2 billion worth of shares to retail investors at a 5 per cent discount to the market price in the spring. The treasury said the share sale would be backed by a nationwide TV, print and digital information campaign.

EUROPE European shares rose sharply as weak data in Europe and elsewhere reinforced expectations the broad monetary policy backdrop will remain equity-friendly, with Glencore and ArcelorMittal lifting the mining sector.

The pan-European FTSEurofirst 300 index ended up 3 per cent and the euro zone’s blue-chip Euro STOXX 50 climbed 3.3 per cent.

Euro zone business activity grew at its weakest pace in four months during September, surveys showed. “Data today is moderately negative for equities but their impact is practically neutral because of growing expectations that easing monetary policies in various countries will continue or be expanded,” said Marco Vailati, head of research at Italy’s Cassa Lombarda.

France’s CAC outpaced the rest of Europe with a gain of 3.5 per cent.

NEW YORK US indices rose, with the S&P 500 up for the fifth day after last week’s disappointing jobs report hardened views that the Federal Reserve won’t raise interest rates this year.

“September was the best time to raise rates and now it looks like it was the only time they could raise rates,” said Mohannad Aama, managing director, Beam Capital Management in New York.

Mr Aama said the uncertainty over rates was likely to continue as investors look for more consistency in economic reports. The Dow Jones industrial average was up 230.87 points, or 1.4 per cent, at 16,703.24. The S&P 500 was up 27.17 points, or 1.39 per cent, at 1,978.53 and the Nasdaq composite was up 48.93 points, or 1.04 per cent, at 4,756.71. – (Additional reporting: PA/Reuters)