Iseq closes 0.3 per cent up after Glanbia’s 7 per cent rise

Market speculation focuses on food group becoming a potential takeover target

The euro trimmed losses after  centrist Francois Bayrou bowed  out of the French presidential race and instead backedindependent candidate Emmanuel Macron. Photograph: Jacques Demarthon/AFP

The euro trimmed losses after centrist Francois Bayrou bowed out of the French presidential race and instead backedindependent candidate Emmanuel Macron. Photograph: Jacques Demarthon/AFP

 

European stocks were little changed as losses in mining companies and energy shares offset positive earnings reports and a rally in Anglo-Dutch consumer goods giant Unilever.

Mining stocks slid the most in three weeks after Goldman Sachs analysts said investors need to see proof of demand and shrinking stockpiles to support the recent rally in commodity prices.

Meanwhile, the euro trimmed losses after a shift in the French presidential race that saw centrist Francois Bayrou bowing out and instead backing independent candidate Emmanuel Macron.

Dublin

The Iseq closed up 0.3 per cent, as food group Glanbia advanced 7 per cent to €18.50.

Shares in the food group spiked towards the end of the session, as market speculation turned to the company becoming a potential takeover target, amid industry appetite for consolidation.

Glanbia had earlier unveiled plans to hive off Irish dairies and agri-business division into a joint venture called Glanbia Ireland, which would be controlled by its main shareholder, Glanbia Co-operative Society.

“There is now a vehicle to absorb parts of the Glanbia business, the Irish operations, which may not have been wanted by a third party, should one express interest in acquiring Glanbia outright for the higher growth performance nutrition products,” said David Holohan, chief investment officer at Merrion Capital.

Elsewhere, building materials group CRH fell 1.2 per cent to €32.91, while Ryanair fell 0.7 per cent to €14.17. Paper and packaging group Smurfit Kappa also declined, closing down 1.9 per cent at €25.70, while the stock was also one of the big fallers on the London market, where it finished down 46 pence at 2,170 pence.

London

Retreats for mining stocks including Anglo American and BHP Billiton meant the FTSE 100 of blue-chip shares finished up just 0.4 per cent, despite a climb of more than 5 per cent for Unilever. The maker of Dove soap and Ben & Jerry’s ice-cream advanced after vowing to boost shareholder returns with a strategic review that might point to a breakup of the consumer-goods giant.

Investors piled into the Marmite-owner as it announced the fresh push to boost shareholder value following Kraft Heinz’s failed takeover attempt. Unilever tumbled in Monday’s session as a result of the aborted takeover.

Among shares rising after corporate results, Lloyds Banking Group rose 4.4 per cent after reporting a surprise profit increase and boosting its dividend.

Business-to-business events organiser UBM added 4.5 per cent after forecasting higher underlying revenue growth in 2017, but Intercontinental Hotels Group was among the fallers.

Europe

The Stoxx Europe 600 Index lost less than 0.1 per cent at the close, halting a three-day rally that had pushed the gauge to a 14-month high.

Germany’s DAX Index added 0.3 per cent, just shy of the 12,000 level it last closed above in April 2015, while the Cac 40 in France also nudged into positive territory.

Signs of stronger economic activity in the euro area and earnings reports had boosted European shares in recent sessions, notwithstanding concern over France’s upcoming election.

Earlier, German drugmaker Bayer fell as much as 3.9 per cent after it said its $66 billion takeover of Monsanto may face delays.

US

The dollar fell while Treasuries advanced after minutes from the Federal Reserve’s latest meeting showed officials confident they can raise rates gradually amid little threat that near-term inflation will accelerate.

Wall Street stocks had fluctuated near all-time highs, as investors awaited the minutes for clues on the pace of tightening. The S&P 500 fell 0.1 per cent at lunchtime in New York, while oil prices also declined.

While American risk assets continue to attract buyers speculating growth in the world’s largest economy is robust enough to withstand higher interest rates, investors in Europe seem increasingly divided, with French presidential elections and the UK’s Brexit plans driving demand for the safest debt.

(Additional reporting: Bloomberg / Reuters.)