Ryanair shares soar after collapse of UK rival Monarch

Irish Stock Exchange outperforms peers, while UK and US share indices rise

Investors expect Ryanair and International Consolidated Airlines Group, which owns owner of Aer Lingus and British Airways, to benefit from the failure of  Monarch. Photograph: Mary Turner/Reuters

Investors expect Ryanair and International Consolidated Airlines Group, which owns owner of Aer Lingus and British Airways, to benefit from the failure of Monarch. Photograph: Mary Turner/Reuters

 

Markets gained ground on Tuesday as the dollar weakened slightly against the euro. The Irish Stock Exchange outperformed peers as a number of leading shares advanced.

DUBLIN

Property investor Green Reit gained 1.86 per cent to €1.533 after analysts at Dublin stockbroking firm Davy set a price target of €1.78 on the stock and ranked it as an outperformer.

Ryanair pushed past the €17 mark for the first time since news of its cancellation woes broke last month. It closed 2.66 per cent up at €17.34.

Traders said that strong passenger numbers for September aided its cause. They also pointed out that investors expect the Irish carrier to benefit from the failure of UK rival Monarch.

Bookmaker Paddy Power Betfair had a strong day, gaining 1.33 per cent to close at €84.43.

Irish Residential Properties Reit tumbled more than 3 per cent in early trade on news that it had lost an appeal against a decision refusing it permission to build almost 500 apartments in Sandyford in Dublin. However, it pared those losses to close just 0.68 per cent down at €1.46.

Bank of Ireland shed 1.37 per cent to close at €6.85. AIB dipped 0.98 per cent to close at €5.06, keeping it above the €5 mark, which traders see as significant.

LONDON

Irish-based exploration group Tullow Oil gained 3.79 per cent to close at 186.20 pence even though oil prices themselves eased.

International Consolidated Airlines Group, owner of Aer Lingus, British Airways and Spain’s Iberia and Vueling, climbed 2.47 per cent as investors expected it to benefit from the failure of UK carrier Monarch, which went into administration this week.

Britain’s top share index climbed to a near eight-week high on Tuesday, boosted by a slide in the pound after weaker construction sector activity and rumbling uncertainty over Brexit negotiations.

Corporate news also supported the index on the day. Heating and plumbing product supplier Ferguson jumped 4 per cent to the top of the FTSE after reporting a rise in trading profit and a £500 million share buyback plan.

Retailers were some of the top gainers, with Sainsbury up 3.5 per cent and Tesco up 2.1 per cent. Berenberg initiated coverage of Sainsbury with a “buy”, naming the retailer its top pick in a sector it said was facing intensifying competitive and cost pressures.

Tesco rose ahead of its interim results on Wednesday. Investors hoped that the company would begin paying dividends again.

Semiconductor maker Electrocomponents touched a 16-year high after a strong trading update.

Advertising giant WPP was among the worst performers, down 2.1 per cent after Morgan Stanley sold 22.5 million shares. The agency’s shares are down nearly 25 per cent since the beginning of the year.

BAE Systems was also among the biggest losers, retreating 1.7 per cent after a downgrade by Berenberg, whose analysts said they expect no organic revenue growth and modest earnings progression in the next two years.

EUROPE

German airline and aerospace group Lufthansa hit a 52-week high of €24.485 as its sector performed well across Europe.

European shares closed higher as a sell-off in Spanish stocks eased and financials gained. Germany’s Dax was up 0.6 per cent and the Cac 40 in France pushed 0.3 per cent higher.

NEW YORK

US indices again hit record highs on Tuesday, boosted by a rally in technology stocks and gains in Ford Motor and General Motors after strong September vehicle sales.

Automakers posted higher US new vehicle sales in September, as consumers in hurricane-hit parts of the country rushed to replace flood-damaged cars. General Motors’ shares rose 3.7 per cent to a record high of $43.70, while Ford’s stock was up 2.3 per cent at $12.37.

Technology stocks have rebounded from a sharp selling seen last week, with Apple and Intel supporting Tuesday’s gains. The sector has been the biggest gainer year-to-date, up 26 per cent so far.

– (Additional reporting: Reuters)