Global equity markets surged and the dollar fell from two-month highs on Monday as investors moved into beaten-down sectors such as banks and travel on the heels of last week’s sharp sell-off.
Euronext Dublin finished the day up 1.7 per cent, driven mainly by the banks and construction companies.
AIB was up 7.4 per cent, while shares in Bank of Ireland rose 6.3 per cent. A trader in Dublin said the banking sector across Europe received a bounce after lender Chinese insurance group Ping An boosted its stake in HSBC Holdings to 8 per cent.
In construction, insulation maker Kingspan was up 4 per cent. “That’s an all-time high at €76.30,” said a trader. “Six months ago, it was at €45 so it’s had an absolutely stellar year.” In the same sector, building materials group CRH was up 3.6 per cent.
Packaging company Smurfit Kappa finished the day up 4 per cent. “That sector was pretty strong following a rally in the US paper names on Friday after they announced they were going to push through price increases,” noted a trader.
Elsewhere, Paddy Power Betfair owner Flutter was flat on the day, while Kerry Group was down 1 per cent. In aviation, Ryanair ended the day up 1 per cent.
The surge in HSBC and an upbeat outlook from spirits maker Diageo, combined with strong economic data from China, lifted London’s FTSE 100 index.
The blue-chip index closed up 1.5 per cent as HSBC Holdings jumped 8.9 per cent. Britain’s banking index surged 8.2 per cent for its biggest one-day gain in over a decade.
Beverage makers jumped 5.6 per cent to mark their best day in six months after Diageo said its outlook for the first half was improving.
The mid-cap FTSE 250 index climbed 1.9 per cent, although an 11.6 per cent decline in bookmaker William Hill kept a lid on gains. A takeover offer for the company from US casino operator Caesars was far below market expectations.
After a rise of up to 0.8 per cent following the China data, mining giants closed down 0.7 per cent.
European stocks bounced back sharply as investors snapped up beaten-down shares in the banking sector that hit a record low last week and data gave signs of pick-up in the Chinese economy.
The pan- European Stoxx 600 index jumped 2.2 per cent, recording its biggest percentage gain since mid-June, after last week’s 3.6 per cent drop. The broader banks index surged 5.6 per cent in its first session of gain in eight days.
Europe’s auto and industrial sectors, heavily reliant on Chinese demand, rose more than 3.5 per cent.
ArcelorMittal SA gained 4.8 per cent after Cleveland-Cliffs agreed to buy the US assets of the steelmaker for about $1.4 billion.
Sonova Holding AG, the world’s biggest hearing aid maker, surged 14.4 per cent as it expects revenue to return to growth in the next six months.
US stocks jumped, bouncing back from the longest weekly losing streak in a year for the S&P 500 and the Dow, with technology, banks and travel shares leading the advance.
All the 11 major S&P 500 sectors were up in early trading. The S&P 500 financials index jumped 2.6 per cent and was on track for its best day in two and a half months.
Shares of technology-related stocks, which bore the brunt of a sell-off earlier this month, were higher, with Facebook, Alphabet, Amazon.com, Apple and Netflix adding about 1 per cent each.
Travel-related shares, including Delta Air Lines, United Airlines and American Airlines Group, rose between 4.7 per cent and 5 per cent.
American Airlines Group said on Friday it secured a $5.5 billion Treasury loan and could tap up to $2 billion more in October.