Oil rebound buoys Europe energy stocks

European shares rose in late trading on Wednesday, hitting another three-month high, as a rebound in oil buoyed energy stocks. However, the Irish market bucked the trend, as three of the biggest components of the Iseq index – CRH, Paddy Power Betfair and Kerry Group – declined.

DUBLIN

The Iseq Overall Index fell 0.7 per cent to 6,921.44, having spend the entire session in negative territory.

Paddy Power Betfair

slumped 4.2 per cent after Credit Suisse initiated coverage of the company with an “underperform” rating, saying it believes that the benefits of the merger between both companies this year have been overplayed.

Kerry Group was also on offer, falling 1.8 per cent to €83.14 after Sensient, a competitor of the Irish company in the North America food flavours and fragrance business, reported weaker-than-expected sales.

CRH, the largest component of the Iseq, declined 0.5 per cent to €25.54.

Elsewhere, banks were a bright spot, with Bank of Ireland rising 2.5 per cent to 25.1 cents in line with the broader European banking sector.

Permanent TSB gained 2.7 per cent to €2.75, helped by news that it has begun talks with the Department of Finance on seeking an extension to its end of June deadline for a UK loans sale. Applegreen lost 2.1 per cent to €4.60 as rival Maxol continued its recent expansion drive in Ireland.

LONDON

Britain’s top share index closed at a fresh year high after a rally in the price of oil spurred gains in commodity-related stocks.

The FTSE 100 ended up 0.1 per cent, at 6,410.26 points, its highest close so far for 2016.

Shares in oil majors Royal Dutch Shell and BP rose 0.7 per cent and 0.2 per cent respectively. Mining companies, the top risers, also helped to push the index higher, rallying on a series of price target upgrades from Investec, which said a bottom of the market had been tested and found.

Anglo American rose 5.2 per cent, while Antofagasta, BHP Billiton, Rio Tinto and Glencore all gained between 0.4 per cent and 3.9 per cent.

In negative territory, however, investment firm Hargreaves Lansdown was the top faller, down 4.4 per cent.

EUROPE

After spending most of the session in the red or flat, the pan-European FTSEurofirst 300 index turned higher as oil prices rebounded after a smaller-than-expected US crude build report offset glut worries stirred by the end of a Kuwaiti oil workers strike.

Banks rose 2.2 per cent, reversing initial weakness, with shares in Deutsche Bank, UniCredit and Santander all up by between 3.6 and 5.2 per cent.

Traders cited no specific trigger behind the reversal but said there was some optimism over the battered sector ahead of the policy meeting today of the European Central Bank, which in March unveiled a stimulus package with measures that could help them weather a low- growth, low-rate environment.

Hotel operator Accor rose 5.3 per cent after the company posted higher underlying sales late on Tuesday, as robust demand for hotel rooms in most markets overcame a weaker performance in France and in recession-hit Brazil.

Volkswagen soared 6.6 per cent on optimism that it can offer US authorities an acceptable resolution of its emissions- test-rigging case.

NEW YORK

Wall Street shares were generally higher in mid-afternoon trade, with the Dow Jones industrial average up 0.37 per cent, while the S&P 500 had gained 0.24 per cent and the Nasdaq Composite was 0.35 per cent higher.

Lexmark, the maker of laser printers, jumped 10 per cent after it agreed to be taken private by investors led by China-based Apex Technology and PAG Asia Capital in a deal valued at $3.6 billion net of cash. However, Coca-Cola fell 4.3 per cent after sales dropped for the fourth straight quarter. – (Additional reporting: Reuters, Bloomberg)