Stock markets and confidence lifted by US data

Talk of more action by the ECB sends investors flocking back to equities

World stock markets rallied sharply yesterday, amid hopes of further economy-boosting moves by central banks and data showing US consumer confidence at a five-year high.

European shares headed back towards recent multi-year highs as talk of more action by the ECB sent investors flocking back to equities.

DUBLIN
While overall volumes on the Dublin market were lower yesterday, the Iseq finished the day up 26.49 points at 4,105.86.

Agri-services group Origin Enterprises soared nearly 11 per cent to €5.30 after the company said it would still hit profit targets despite a slow start to the year. In a trading update, the company predicted the fourth quarter will account for an increased level of profits within its agri-services division.

CRH climbed 2.5 per cent to €16.85, an increase one stockbroker attributed to news yesterday that the Government is examining a €1 billion fund to boost the building sector.

There was also some movement in Paddy Power stock, which increased 1.6 per cent to close at €65.90.

LONDON
More than £27 billion was added to the value of blue-chip shares yesterday as markets soared on booming US consumer confidence and hopes of further economic stimulus from central banks.

London’s FTSE 100 index surged 1.6 per cent — or 107.7 points — to 6762 as stock markets around the globe resumed their rally after data showed confidence in America’s vast consumer sector is at five-year highs.

AstraZeneca rose 2.7 per cent to its highest price since 2006 after the UK's second-biggest drugmaker agreed to buy Omthera Pharmaceuticals for $323 million.

Victrex climbed to the highest price since its initial public offering in 1995.

GlaxoSmithKline climbed 1.9 per cent as Deutsche Bank advised investors to buy the shares. Persimmon and Taylor Wimpey each added at least 3 per cent after a report showed UK house prices increased in May.

EUROPE
European stocks advanced, with the Stoxx Europe 600 Index climbing the most in more than a month, as US and UK markets reopened following a public holiday.

Aixtron jumped 7.8 per cent to €13.57 after Natixis recommended buying the maker of equipment for the semiconductor industry.

Bayer gained 2.2 per cent to €86.60 after analysts upgraded the shares. Continental added 2 per cent to €101.80 after announcing an agreement with OC Oerlikon to develop and sell transmission systems for hybrid and electric vehicles.

Cie Financiere Richemont, the owner of the Cartier brand, added 3 per cent, while Basilea Pharmaceutica jumped 6.8 per cent after saying that the US Food and Drug Administration has granted orphan-drug status for one of its treatments.

The Stoxx 600 increased 1.3 per cent to 308.23 at the close of trading, extending its rally this month to 3.9 per cent. France’s CAC 40 rose 1.4 per cent and Germany’s DAX advanced 1.2 per cent.

US
US stocks rallied more than 1 per cent in early trading yesterday after investors were reassured that central banks would continue policies designed to promote global growth.

Further boosting the market, data showed consumer confidence was the strongest in over five years in May while home prices accelerated by the most in nearly seven years in March.

Nine out of 10 S&P 500 groups advanced, paced by a 1.4 per cent rally among financial shares.

Merck added 1.8 per cent after Jefferies lifted the stock to a buy.

Tiffany and Co increased by 3.3 per cent after reporting first-quarter earnings that beat analysts' estimates.

Omthera Pharmaceuticals soared a record 99.1 per cent to $13.48 after AstraZeneca agreed to buy the company for $443 million. US-listed shares of AstraZeneca gained 1.6 per cent to $53.

The Dow Jones Industrial Average raced ahead by 1.2 per cent in early trading after figures revealed consumer confidence last month hit its highest level since February 2008. – Additional reporting: PA, Bloomberg