Irish shares buoyed by US infrastructure, Brexit hopes
Market report: CRH stood out as a bright spot, rising almost 2 per cent to €31.25
CRH buoyed by renewed hopes that US president Donald Trump will be able to push through infrastructure spending plans
Irish shares closed higher on Friday, with Iseq index heavyweight CRH buoyed by renewed hopes that US president Donald Trump will be able to push through infrastructure spending plans.
The Iseq added 0.6 per cent to 6,787.79, helped further by expectations of a breakthrough in Brexit negotiations, while the pan-European Stoxx 600 index gained 0.3 per cent.
CRH stood out as a bright spot, rising almost 2 per cent to €31.25, with news that the US senate had narrowly approved Mr Trump’s budget vehicle for tax cuts reignited speculation that the US president will be able to pursue other fiscal priorities, including a $1 trillion infrastructure programme.
Kingspan added 1.3 per cent to €35.30.
Bucking the trend, insurer FBD lost 3.6 per cent to €7.81 as investors fretted about the impact of Storm Brian over the weekend. Industry sources told The Irish Times on Thursday that the cost to insurers of Storm Ophelia on Monday will likely below the €111 million burden of Storm Darwin in February 2014.
Bank of Ireland lost 1.94 per cent to €6.52 amid ongoing concerns over the final impact of the tracker mortgage scandal on the banking industry. Taoiseach Leo Varadkar warned during the week that banks may face higher taxes if they fail to sort out the issue, while it emerged on Thursday that the Central Bank had begun an enforcement investigation into the country’s largest lender by assets.
Britain’s FTSE closed up 0.2 per cent as sterling bounced back on hopes of a breakthrough in Brexit negotiations, and consumer heavyweights Unilever and Reckitt Benckiser weighed down an index that was earlier lifted by financials.
The FTSE 100, which hit a record level last week, was on track for a slight weekly loss after four weeks of robust gains, bruised by sharp drops earlier in the week from Convatec and Merlin.
British prime minister Theresa May won a modest reprieve in stalled talks with the European Union as EU leaders said they would begin preparations to move into the second phase of Brexit talks in December.
The pound strengthened to 89.3p per euro, leaving it up 0.8 per cent on the day.
Unilever and Reckitt were among the leading decliners after weak results earlier this week, closing down 3.2 and 2.7 per cent respectively.
Miner Fresnillo was the top FTSE 100 loser, closing 3.6 per cent lower, after a downgrade to “neutral” from top-ranked Credit Suisse analyst Ivano Westin on the grounds that it was now well-priced.
Ericsson and Volvo Trucks led European shares higher on Friday with well-received earnings reports during a session where financials and tech stocks also outperformed.
Mobile network gear maker Ericsson soared 8 per cent as it said it detected signs of improvement after its restructuring efforts.
Swedish truck maker Volvo Trucks was a close second with a 7 per cent rise, hitting a record high after beating expectations
European third-quarter earnings are expected to grow 4.5 per cent from the same period in 2016, an increase of 1.3 per cent excluding the energy sector.
Financials were the biggest support to the STOXX, with banks up 1.2 per cent and shares from the technology rising an average of 0.6 per cent.
Technology and bank stocks lifted Wall Street in midday trade and investor optimism received a fresh boost from Washington, where the Trump administration inched a step closer to implementing tax-cut plan.
Bank of America and Goldman Sachs were in demand, while Apple led a recovery in technology stocks.
Hopes of tax cuts have helped the market rally, as companies expect the move to lift economic growth and inflation.
The Dow Jones Industrial Average, S&P 500 and Nasdaq each gained 0.3 per cent.
However, General Electric shares slipped after the industrial conglomerate reported a profit miss and slashed its earnings forecast.
Procter & Gamble dipped after the company’s sales narrowly missed estimates.
(Additional reporting: Reuters)