European stocks post their best week since November 2020

Russia pays interest due on two dollar bonds

Global equity markets gained on Friday after traders cheered a Russian bond payment that averted a historic sovereign default, while gold prices dropped as demand for the safe-haven metal eased following the start of the US interest rate hike cycle.

DUBLIN

In keeping with gains elsewhere in the gambling sector, Paddy Power Betfair owner Flutter rose 3.6 per cent to €114. Irish bank shares had a mixed day, with AIB advancing 0.3 per cent to €2, while Bank of Ireland finished down 1.2 per cent at €5.79.

Among the standout performers was Cairn Homes, which rose 4.3 per cent to €1.24 and travel software group Datalex, which increased 3.6 per cent to 87 cent. Building materials giant CRH cemented gains earlier this week, rising a further 1.6 per cent to €41.17. Ryanair was, however, down by almost 1 per cent at €13.71 as investors pondered the likely impact of Ukraine on Europe's travel sector.

LONDON

The Ftse 100 continued a winning streak on Friday as it notched up its fifth rise in six sessions. The index registered a small but clear rise of 0.3 per cent, after trading down earlier in the day.

The 19.39 point increase leaves the Ftse 100 at 7,404 as it heads into the weekend, having gained more than 250 points since last Friday. Ocado led the pack, bouncing back after a torrid performance the day before when investors had reacted with horror to its latest set of results.

Gambling groups were also close to the top of the pack, and Kingfisher did well ahead of its results coming out next week.

Energy companies, and mining firms struggled over the day, as the price of oil remained stable – at least compared with recent rollercoaster performances – rising less than 0.5 per cent to $107 dollars for a barrel of Brent crude. Shares in pub chain JD Wetherspoon gained 1.9 per cent after it said that its businesses were returning closer to normal recently as pandemic restrictions were eased off.

EUROPE

European shares rose on Friday, adding to the strong gains earlier this week, as investors focused on Russia-Ukraine peace negotiations and digested the talks between US president Joe Biden and Chinese counterpart Xi Jinping. The pan-European Stoxx 600 index closed 0.9 per cent higher, with technology stocks leading the gains. The benchmark index was headed for its best weekly performance since November 2020 on optimism that peace would be negotiated in the Ukraine conflict, which has rattled global markets.

German property giant Vonovia slipped 3.3 per cent even as it said it was on course for "significant growth" after a record year and the acquisition of smaller rival Deutsche Wohnen in 2021.

NEW YORK

The Nasdaq and the S&P 500 indices inched higher in volatile trading on Friday as megacap stocks gained ground, while investors assessed the Joe Biden-Xi Jinping talks. Nvidia, Tesla, Apple and Microsoft rose 0.6-2.9 per cent, boosting the tech-heavy Nasdaq.

Both leaders spoke on a video call, which lasted just under two hours, about Russia's invasion of Ukraine, and Chinese media said Mr Xi underlined that such conflicts were in no one's interests. Mr Biden was expected to tell the Chinese leader that Beijing would pay a steep price if it supported the invasion.

"The geopolitical concerns are responsible for the vast majority of the market movement this week, despite the fact that the Fed hiked interest rates," said Randy Frederick, vice-president of trading and derivatives for Charles Schwab in Austin, Texas.

Eoin Burke-Kennedy

Eoin Burke-Kennedy

Eoin Burke-Kennedy is Economics Correspondent of The Irish Times

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