Oil and mining stocks pull up Europe
The Iseq dips on low trading volumes and little newsflow but Tullow is up nearly 6%
Ryanair was among the most actively traded, falling more than 1 per cent to €13.06. Photograph: Chris Radburn/PA Wire
European shares rose on Tuesday, following a somewhat choppy session, as an advance by oil and mining companies offset weakness in some banking stocks. The Stoxx 600 rose 0.5 per cent to 334.6 after swinging between gains of 0.4 per cent and losses of 0.7 per cent.
The Iseq dipped 0.4 per cent to 6,173 in a session marked by low trading volumes and little newsflow. Ryanair was among the most actively traded, falling more than 1 per cent to €13.06 after chief executive Michael O’Leary said he believed the industry would need to cut fares as a result of traveller nervousness following last month’s terrorist attacks in Brussels.
Tullow Oil soared 5.8 per cent to €2.45 as global oil prices climbed to a four-month high on reports that Saudi Arabia and Russia had reached an agreement on output restrictions. Brent rose 3.7 per cent in London to $44.40 a barrel, having earlier touched levels not seen since early December.
Kerry lost 1.2 per cent to €81.80, giving up some of its recent gains as the stock touched on all-time highs, as the stock’s defensive qualities lost some of its allure, for the moment.
On the bond market, the market interest rate on Ireland’s benchmark 10-year notes rose for a second straight session, ahead of a €750 million bond sale tomorrow, as investors continued to worry about the political stalemate following the general election and the prospects of the economy being hit by the UK exiting the European Union.
The yield on Ireland’s 2026 bonds rose 0.6 percentage points to 0.88 per cent.
The blue-chip FTSE 100 index closed 0.1 per cent lower at 6,200.12 points. Mining stocks such as Anglo American and Glencore rose, boosted by data showing that deflationary pressures had eased in China, the world’s biggest consumer of metals. However, shares in housebuilders such as Berkeley, Barratt Developments, Taylor Wimpey and Persimmon all fell.
Traders said the housebuilding and property sector was being hit by concerns about UK economic growth and a slowdown in the London prime property market, which could be exacerbated if Britain voted in June to leave the EU (Brexit).
Across the continent, Germany’s DAX advanced 0.8 per cent while the CAC 40 in France gained 0.7 per cent.
LVMH dragged consumer stocks down after posting sales that missed estimates.
Wall Street shares were in positive territory in mid-afternoon trade there, helped by a surge in oil prices.
The S&P 500 index has risen more than 12 per cent from its low in February as oil rebounded and data suggested that the US economy was recovering.
Still, global risks remain a concern. The International Monetary Fund cut its global growth forecast for the fourth time in the past year on Tuesday, citing China’s slowdown and chronic weakness in advanced economies.
The Dow Jones industrial average was up 0.72 per cent at 17,682.94, while the S&P 500 gained 0.64 per cent to 2,054.96 and the Nasdaq Composite rose 0.37 per cent, at 4,851.05.