Stocks rise as Fed chief backs stimulus

Stocks were generally a touch stronger yesterday, as investors took comfort from Federal Reserve nominee Janet Yellen's comments on taking care not to withdraw stimulus too early from the US economy. In Europe, news of lacklustre economic performance took a back seat.

DUBLIN
The Iseq edged into a positive close yesterday, finishing just 0.25 per cent higher. A poor day from CRH held things back as the market heavyweight finished 1.27 per cent, or 24.5 cent weaker at €19.05. Dealers said investors were realising gains notched up over recent weeks, in advance of last Tuesday's shareholder update.

An interim management statement is expected next week from Paddy Power, which yesterday rose by 29 cent to €62.79. Also due to update investors next week is IFG, which yesterday added 1.2 cent to finish at €1.455.

FBD had a good day, probably on expectations that it would benefit from the difficulties that emerged last week at RSA. Shares rose by 35 cent to €17.00.

Bank of Ireland, seen by many as a proxy for the economy, didn't see a huge benefit from the State's decision to eschew a post-bailout precautionary credit line, ending the session just 0.2 cent stronger at 26.9 cent.

C&C held up well after two of its senior executives sold shares. The stock rose by 5.8 cent to €4.584.

Ryanair was weaker, falling by 9.6 cent to €5.529.

LONDON
UK stocks advanced for a second day, trimming a weekly loss, as investors weighed data on US industrial and manufacturing output to gauge the health of the world's largest economy. Royal Dutch Shell and Tullow Oil rose at least 1 per cent each, tracking gains in European oil-and-gas stocks.

Talvivaara Mining tumbled 43 per cent as the nickel miner said it will apply for corporate reorganisation and file for bankruptcy if that fails.

The FTSE 100 Index gained 27.31 points, or 0.4 per cent, to 6,693.44 at the close in London. The benchmark slipped 0.2 per cent this week as the Bank of England said unemployment may reach its threshold to consider interest-rate increases sooner than forecast. The broader FTSE All-Share Index added 0.3 per cent.

"Stocks are being helped by the direction of the global economy and by the resilience of policy makers," said John Haynes, head of research at Investec Wealth and Investment in London. "There's no way policy makers will taper stimulus measures too fast. If they do so, it will be because of a strong recovery."

EUROPE
European stocks advanced for a sixth week, posting their longest winning streak since August 2012, as signs emerged the Federal Reserve won't rush to reduce the pace of its stimulus, outweighing data that showed the euro-area economic recovery is faltering.

Bouygues rose 5 per cent after reporting better-than-estimated earnings. Serco Group posted the biggest drop in more than 22 years after forecasting a profit decline next year.

The Stoxx Europe 600 Index climbed 0.1 per cent to 323 this week. The 600-share regional benchmark has surged 15 per cent this year, reaching its highest level since May 2008, as central banks around the world pledged to continue their support for economic growth.

National benchmark indexes rose in 11 of the 18 western European markets. Germany’s DAX gained 1 per cent, while France’s CAC 40 added 0.8 per cent.

NEW YORK
US stocks rose, with benchmark gauges extending records, as investors assessed data on factory production amid speculation the Federal Reserve will maintain stimulus.

Exxon Mobil gained 1.1 per cent after Warren Buffett's Berkshire Hathaway disclosed a stake. FedEx climbed 1.4 per cent after billionaire investors George Soros and John Paulson took positions. – (Additional reporting, Bloomberg)