Rally continues after Bernanke reassurance

Irish property company Green REIT rises 10 per cent in stock market debut

US Federal Reserve chairman Ben Bernanke testifies before the Senate banking committee in Washington DC yesterday. Photograph: Win McNamee/Getty Images

US Federal Reserve chairman Ben Bernanke testifies before the Senate banking committee in Washington DC yesterday. Photograph: Win McNamee/Getty Images


Stock markets around the world extended their rally yesterday as investors felt reassured the Federal Reserve would unwind stimulus measures with care.

The euro fell and the dollar rose against a basket of currencies as Ben Bernanke, chairman of the Federal Reserve, testified before Congress for a second day, this time to the US Senate banking committee.

Green REIT was one of the main topics of conversation on the Dublin market yesterday, with shares in the Irish property company getting off to a good start in their stockmarket debut.

The stock surged by 10 per cent to finish the day at €1.10 with more than 27 million shares traded.

It was also a good day for Ryanair, after American Airlines posted strong second-quarter results, lifting the airline sector. As a result, Ryanair soared nearly 3.6 per cent to €7.32.

News that CRH had appointed a new chief executive helped the stock perform well according to analysts, with the building materials giant outperforming its peers to close up 2.45 per cent at €15.67.

The Iseq also outperformed its peers, finishing the day up 82.84 points at 4,097.

“There were no bad stories yesterday, it was all positive and nice to see that the Iseq outshone Europe,” one stockbroker said.

UK stocks rose to the highest level in seven weeks, led by London Stock Exchange Group and WPP, as a report showed American jobless-benefit claims fell to a two-month low.

LSE rallied to a five-year high after saying first-quarter revenue rose 39 per cent.

WPP, the world’s biggest advertising company, climbed 3.6 per cent after French peer Publicis reported first-half sales that exceeded estimates.

Tate and Lyle fell 0.9 per cent after Societe Generale lowered its rating on the shares.

EasyJet advanced 4.2 per cent to 1,406 pence, its highest price since it sold shares to the public in November 2000.

The FTSE 100 Index added 62.43 points, or 1 per cent, to 6,634.36 at the close in London, the highest level since May 30th.

European stocks climbed to a six-week high as Publicis Groupe posted increased profit, revenue and fewer Americans than forecast filed jobless-benefit claims.

Publicis, the world’s third-biggest advertising company, advanced 3.4 per cent.

Banca Popolare di Milano, Italy’s oldest co-operative bank, and Spain’s Bankinter led a rally in financial companies.

Ericsson retreated 4.8 per cent after it reported revenue that missed estimates as competition with Huawei Technologies for contracts to build and service phone systems intensified.

Nokia declined 2.8 per cent to €3 .01 after the phone maker reported second-quarter revenue that trailed analysts’ estimates as handset demand fell.

The Stoxx Europe 600 Index rose 0.9 per cent to 299.76 at the close, the highest level since May 31st.

France’s CAC 40 rose 1.4 per cent and Germany’s DAX rallied 1 per cent.

US stocks rose in early trading yesterday, sending the Standard and Poor’s 500 index to an intraday record, amid better- than-estimated earnings and jobless claims as investors weighed testimony from Federal Reserve chairman Ben Bernanke.

Morgan Stanley rallied 5.1 per cent as stock-trading revenue bolstered profit.

International Business Machines added 2.4 per cent after raising its full-year earnings target.

Intel lost 3.5 per cent after forecasting third-quarter sales that may fall short of some analysts’ predictions, while eBay tumbled 6.5 per cent after its forecast for third-quarter sales missed estimates. – (Additional reporting: Bloomberg, Reuters)