European shares rise after positive blue-chip trading updates

Iseq advances 2.2% for back-to-back session gains after gloomy start to the trading week

A slew of upbeat updates from European blue-chip firms helped the region’s benchmark index posts its best session in 11 weeks on Wednesday and further recover from Monday’s sharp losses, while travel stocks roared back after weeks of decline.

A rise in hammered bond yields helped banks post their best session in more than four months. Meanwhile, investors expect the European Central Bank to stick to a dovish tone at its Thursday policy meeting.


The Iseq rose 2.2 per cent for its second consecutive gain after a dismal start to the week on Monday. Several major stocks posted decent advances after buyers returned to the market.

As banks climbed across Europe, AIB surged 5.8 per cent to €1.93, while Bank of Ireland finished 1.4 per cent higher at €4.10. Building materials group CRH, the largest stock on the index, added 1.3 per cent to €41.12.


It was a good day for Dalata Hotel Group, which soared 7.3 per cent to €3.74 after analysts at Davy updated their forecasts for the stock, and Ryanair, with the airline closing 4.2 per cent higher at €15.58, as optimism returned to investors in travel stocks.

Packaging group Smurfit Kappa added 2.25 per cent to €45.91, while Paddy Power owner Flutter Entertainment rose 4.1 per cent to €143.70.


Travel-related stocks and retailers helped London’s FTSE 100 to record its strongest session in more than five months, while fashion chain Next was the top gainer after it raised its profit outlook following robust earnings.

Shares of the British fashion retailer surged 7.5 per cent after it said it had soundly beaten its expectations for full-price sales and, as a result, was increasing its profit forecast.

The blue-chip index ended 1.7 per cent higher, with Compass Group, Aer Lingus owner International Consolidated Airlines Group, Whitbread and Rolls-Royce among the top gainers.

The domestically focussed FTSE 250 mid-cap index rose 1.9 per cent, marking its best day since January 2020.

Media group Future jumped 9.2 per cent and was among the top boost to the mid-cap index after it said it expects its full-year profitability to be ahead of expectations.

Royal Mail dropped 2.7 per cent to the bottom of the FTSE 100 after it said fewer parcels were being delivered to homes as pandemic restrictions eased across the country, even as it reported a 12.5 per cent rise in first-quarter group revenue.


The pan-European Stoxx 600 rose 1.7 per cent, extending Tuesday’s small gains. Travel and leisure stocks jumped 3.7 per cent after getting hammered recently by worries about a resurgence in Covid-19 cases.

In Frankfurt, the Dax advanced almost 1.4 per cent, while in Paris, the Cac 40 closed 1.85 per cent higher.

Dutch semiconductor equipment maker ASML Holding rose 3.1 per cent and neared all-time highs after it raised its 2021 sales outlook and announced a new share buyback plan. Shares in peers ASM and BE Semiconductor rose about 3 per cent each.

Shares in Swedish transportation-equipment maker Thule soared after its second-quarter earnings beat expectations.

But Europe's most valuable tech company, SAP, dropped 3.2 per cent, with investors disappointed that revenue and profit outlook had not been lifted further. Swiss drug maker Novartis fell 0.7 per cent despite second-quarter core net income beat.


Wall Street extended Tuesday’s gains as investors moved money into riskier assets.

Positive earnings from major companies, including Verizon Communications, Coca-Cola and Chipotle Mexican Grill, helped fuel the optimism.

Coca-Cola rose 1.9 per cent in early trading after boosting its full-year sales forecast, while Verizon added 1.1 per cent after its quarterly results beat estimates.

Oil prices rose as improved risk appetite provided support despite data showing an unexpected rise in US crude inventories last week and a weaker demand outlook due to rising Covid-19 infections. – Additional reporting: Reuters