Global markets surge after positive economic news from China
Euronext Dublin benefits from bounce, with Irish banks leading the way
Bank of Ireland was described by one trader as the “standout” performer, finishing the day up 6.6%
Global stock markets rallied and China’s yuan posted its biggest gain since December on Monday as investors bet the Chinese economy would boost global growth even as surging coronavirus cases delayed business reopenings across the US.
Euronext Dublin benefited from the overnight bounce enjoyed by Asian markets, with the banks leading the way.
Bank of Ireland was described by one trader as the “standout” performer, finishing the day up 6.6 per cent. AIB, meanwhile, added 3.1 per cent to its share price.
Traders said there was no market-specific news driving the surge, remarking: “Ireland is in vogue and investors like what they see”.
It was a positive day for homebuilders too, with Cairn Homes rising 5 per cent, while Glenveagh Properties was up 1.2 per cent in line with the index. Building materials company Kingspan ended the day up 3.5 per cent.
Traders suggested homebuilders here may have benefited from a “very strong” day for UK homebuilders on the back of news that the tax threshold for builders may be raised.
In terms of underperformers, some food companies fared poorly, with Greencore down 2 per cent, and Kerry Group up just 0.5 per cent despite the index finishing up 1.6 per cent.
Overall, however, it was a quiet day on the market, with volumes down 30 per cent compared with the average day.
Housing stocks helped drive the London markets into positive territory as traders optimistically welcomed speculation over a stamp duty holiday. The FTSE 100 closed 128.64 points higher at 6,285.94p at the end of trading on Monday.
Barratt Developments led the FTSE’s risers after it said its finances were good enough to repay furlough money it claimed, as it also soaked up optimism over stamp duty reports. Shares closed 39.1p higher at 529.4p.
Cineworld shares dipped by 2.56p to 57.6p after it said it is being sued by Canada’s biggest cinema chain after pulling out of a £1.3 billion deal to buy the business.
The biggest risers on the FTSE 100 were Barratt up 39.1p at 529.4p, Rolls-Royce up 17.7p at 280.9p, HSBC up 25.15p at 408.65p, and Persimmon up 139p at 2,398p.
The biggest fallers of the day were BT Group down 1.85p at 109.5p, ITV down 1.08p at 70.84p, Tesco down 2.6p at 218.9p, and DS Smith down 3.2p at 288.2p.
European shares closed at their highest in nearly a month. The pan-European Stoxx 600 climbed 1.6 per cent on broad-based gains, with Asia-focused lender HSBC jumping 6.6 per cent to lead Europe’s battered banks index almost 4 per cent higher.
Other stocks exposed to China, including carmakers, industrials, energy firms and luxury goods makers, gained strongly.
Elsewhere, Spain’s IBEX ended 2 per cent higher, while Germany’s DAX rose 1.6 per cent.
Among individual stocks, sensor-maker AMS climbed 4 per cent, while Swiss speciality chemicals group Clariant slumped 12.6 per cent to the bottom of Stoxx 600 on trading ex-dividend.
Wall Street’s major indexes climbed as data showing unexpected growth in the US services sector last month, and optimism over China’s economic revival helped investors look past a surge in new cases of Covid-19 at home.
A slew of upbeat US data, including a record rise in June payrolls, has powered the Nasdaq to all-time highs and brought the S&P500 and the Dow about 6 per cent and 11 per cent below their respective peaks from February.
Ten of the 11 major S&P sectors were trading higher, with technology providing the biggest boost to the benchmark S&P500.
Among individual shares, Tesla surged 9 per cent, rising for the fifth session as JPMorgan bumped up its price target for the electric carmaker’s stock following better-than-expected quarterly deliveries.
Uber Technologies climbed 5.4 per cent after the ride-sharing company agreed to buy food-delivery app Postmates in a $2.65 billion all-stock deal. – Additional reporting: Agencies