European shares make modest gains despite weaker-than-expected data
Food group Aryzta is star performer in Dublin after rising 3.3 per cent
Irish-Swiss food group Aryzta was the star performer, rising €2.11 or 3.3 per cent to €65.36, following positive first-quarter results earlier in the week. Photograph:Cyril Byrne/The Irish Times
European shares rose again despite surveys that showed the euro zone economy may face another contraction.
Investors looked to a European Central Bank meeting today that may pave the way for more monetary easing in the currency bloc.
Recent disappointing economic indicators from Europe have stoked investor concerns about the threat of deflation amid weak global growth, though this has also been offset by the prospect of more central bank intervention that would cheer markets.
Dublin’s Iseq ended 59 points or 1.2 per cent up at 5,159 in what was described as “a patchy day’s trade”.
Irish-Swiss food group Aryzta was the star performer, rising €2.11 or 3.3 per cent to €65.36, following positive first-quarter results earlier in the week.
Ryanair finished the day up 2 cent at €8.72 despite lagging rivals EasyJet and British Airways owner IAG, which benefitted from the announcement in Britain of plans to scrap air travel tax charged for children
Even though the share price was little changed on the day, down 1 cent at €1.34, GreenREIT enjoyed a high volume of trade, confirming the increased interest in the property company.
Building materials group CRH added 40 cent or 2 per cent to its value to finish at €19.66, while Dragon Oil finished up 25 cent or 3.9 per cent at €6.73 following an international rebound in oil prices. LONDON London’s top share index edged down from a one-week high, with moves in stocks exposed to new British government policies dominating in an otherwise quiet session.
Renewed weakness in Royal Mail was the main drag on the blue-chip FTSE 100 index, which closed down 0.4 per cent at 6,716.63 points.
Property firms Barratt Developments and Taylor Wimpey, which look set to join the blue-chip FTSE 100 this month after rallies this year of 30 and 20 per cent respectively, rose around 1.7 per cent after changes to a property tax.
EasyJet and IAG extended gains, trading 1.3-2.5 per cent higher.
But blue-chips struggled, hindered by another drop in Royal Mail. It fell 1.8 per cent, extending the previous session’s 3 per cent loss, after regulator Ofcom said it would not change rules for direct mail delivery, dashing Royal Mail’s hopes of being shielded from a rival.
Gains in miners helped propel European stocks to within 0.1 of a percentage point of a six-year high amid bets that the European Central Bank will expand stimulus.
The Stoxx Europe 600 Index increased 0.6 per cent to 349.34 at the close of trading in London. That’s its highest level since June 10th, and Rio Tinto pushed a measure of commodity companies to the biggest gain on the gauge.
Rallies in healthcare shares and banks also helped send the Stoxx 600 higher. Drugmakers climbed to a record, and lenders to their highest level in two months. Telenor added 2.3 per cent and TeliaSonera gained 1.6 per cent after the phone carriers agreed to combine their Danish businesses.
US stocks rose modestly in early trading as energy-related shares rose for a third straight session and data pointed to improving conditions in the US services sector, which makes up a majority of the economy.
Market moves were slight, with many traders looking ahead to a key meeting of the European Central Bank.
The S&P 500 energy sector rose 1.3 per cent as the top-performing sector on the day, up alongside a 0.6 per cent increase in the price of crude oil. Cimarex Energy was the S&P 500’s top percentage gainer, up 5.9 per cent at $108.98.
Diamond Offshore rose 3.7 per cent to $31.46. – Additional reporting Reuters