Rally in oil stocks pulls European markets into positive territory

The Iseq nudged up by close to 1 per cent as, despite worries over Russia’s economy, a rally in energy shares sent US and European equities higher after the American oil benchmark erased losses.

After fluctuating between gains and losses all day, European stocks ended up posting their biggest jump since December 5th, snapping six days of losses.

Across the Atlantic, traders made bets on the level of support the Federal Reserve might maintain for the US economy, as it began a two-day policy meeting.

DUBLIN Providence Resources, the oil explorer led by Tony O'Reilly jnr, ended down just over 1 per cent at 84 cents, although the stock fluctuated heavily throughout the day. It opened down 2.4 per cent, before quickly rising to a gain of 6 per cent, before falling again and recovering to its closing price.

The company is reportedly close to a deal with Sequa Petroleum to take a stake in its Barryrose prospect. It is also being affected by the falling price of oil.

CRH was the most heavily traded stock on the Iseq, traders said, as investors digested confirmation that it intends to sell parts of its business to Bain Capital. The private equity group linked to Mitt Romney will pay CRH £414 million for its clay and concrete business in the UK and its clay operations in the US. CRH finished almost 3.4 per cent, at €17.85.

Bank of Ireland also had a good day on relatively heavy volumes, up 3.26 per cent to close at 31.7 cents.

LONDON UK stocks rose the most in 17 months, rebounding from a six- day drop that had pushed the FTSE 100 Index to its lowest level since June 2013.

Royal Dutch Shell and BP pushed energy stocks higher after a nine-day rout. Rio Tinto and BHP Billiton rose more than 3 per cent as mining shares rebounded from a five- year low.

Afren rose 9.2 per cent after saying drilling tests in Madagascar showed signs of oil.

Barclays added 2.2 per cent and Lloyds Banking Group gained 3.3 per cent after passing a stress test set by the Bank of England.

Imagination Technologies rallied 16 per cent after first- half sales exceeded estimates.

EUROPE The Stoxx Europe 600 Index added 1.7 per cent, halting its biggest slump in more than three years. The gauge earlier fell as much as 1.3 per cent as factory data from China and France missed economists’ forecasts.

Italy’s FTSE MIB Index rallied 3.3 per cent, rebounding from a one-year low and posting the biggest gain among 18 western European markets.

Daimler gained 4 per cent and Continental added 3.6 per cent, pushing an index of car- makers higher. The European Automobile Manufacturers Association said 11- month sales had risen 5.5 per cent, to 12 million cars.

Orange rose 3.7 per cent and Deutsche Telekom added 3.1 per cent after BT Group started exclusive talks to acquire EE, their British wireless venture.

NEW YORK US stocks had a volatile session. Investors have bet that the Federal Reserve will be cautious in removing support in the face of a more fragile global economy.

Fed officials will decide this week whether to make a critical change to their policy statement that would widen the door for interest rate increases next year.

CVS Health, up 4.8 per cent in the afternoon to $94.14, led gains on the S&P 500 after a strong 2015 forecast. 3M lifted its dividend and was the top gainer on the Dow industrials, with a 2.5 per cent advance.

Boeing, up 2.6 per cent at $125.20, was among the best performers on the day after it raised its dividend and perked up its buyback programme.

Range Resources, Nabors Industries and Diamond Offshore Drilling jumped more than 6.6 per cent, as energy shares climbed from a two-year low. – Additional reporting: Bloomberg/Reuters