Stocks edge up after tough week
Perrigo hammered on news of €1.6 billion tax demand
Shares in Nike jumped 7.85 per cent after the company’s quarterly results beat Wall Street estimates. Photograph: Getty
Pressure eased on markets on Friday with stocks edging up following a tough week. Irish-based Perrigo took a hammering as it emerged that the Revenue Commissioners are chasing it for a €1.6 billion debt.
Building materials giant and index heavyweight CRH was one of the few active shares on the last day’s trading before Christmas. The stock closed 2.47 per cent up on Friday at €22.38 after a credit agency posted a positive report on the Irish group’s German rival Heidelberg.
Airline Ryanair was down 2.16 per cent at €10.215. Dealers said nothing specific depressed the stock, but pointed out that Brexit and general uncertainty was putting investors off buying the shares. “It needs a decent buyer to step up to the mark,” one said.
Elsewhere, property-related stocks remained well out of favour, continuing a drift that began several weeks ago. Green Reit fell 1.31 per cent to €1.352, while Hibernia fell more sharply, dropping 2.62 per cent to €1.266.
UK blue-chip stocks rose slightly on Friday, recouping the session’s losses as mining stocks gave investors something to cheer about at the end of a largely dismal week that was underpinned by global economic growth concerns. The FTSE 100 gained 0.1 per cent, while the FTSE 250 was roughly unchanged as the market wrapped up its final full week of trading in 2018.
Higher metals prices boosted miners. Anglo American gained 2.84 per cent to 1,751.6 pence sterling. Rio Tinto, BHP and Antofagasta rose 1.4 per cent to 1.6 per cent on higher copper prices.
Investors developed an appetite for fast-food delivery service Just Eat. It rose 3 per cent to 589p after rival Takeaway. com struck a €930-million deal to buy larger rival Delivery Hero’s activities in Germany.
Better-than-expected results from sportswear maker Nike provided temporary respite to the battered retail sector, with JD Sports jumping more than 7 per cent to 341.5p, ranking it among Friday’s top mid-cap gainers.
German cement giant Heidelberg gained 1.2 per cent to €53.88 in Frankfurt after ratings agency Fitch rated the group’s outlook as “stable”. The assessment followed recent comments by analysts setting a price targets for the stock of about €70. Italian rival Buzzi ticked up 0.23 per cent to €15.04. The news also lifted Irish behemoth CRH.
French engineering group Spie was also one of the session’s winners, rising 6.1 per cent to €11.47 after announcing the sale of a German subsidiary specialising in offshore cables.
Adding gloom to the European banking sector, which has fallen 28.5 per cent so far in 2018, Danske Bank, at the centre of an international investigation into alleged money laundering, cut its 2018 outlook for the second time this year.
The Danish lender was down 0.8 per cent. Refinitiv data showed on Friday that European equity raising slowed sharply in 2018, making it the biggest drag on falling global activity as political uncertainty and growth concerns made it harder to persuade investors to buy stock.
Perrigo had plunged almost 25 per cent shortly after 5pm Irish time on Friday on news that the Revenue Commissioners had issued the pharmaceutical manufacturer with a demand for €1.6 billion.
The Irish-based but US-listed group was 24.8 per cent down at $39.40 at 5.02pm. The Revenue claim dates back to the 2013 sale by Elan – which Perrigo subsequently bought – of a stake in multiple sclerosis treatment Tysabri to Biogen for $3.25 billion.
Perrigo plans to challenge the assessment. The company says that the Republic’s tax authority’s assessment is “without merit” and “incorrect as a matter of law”. However, investors sold the stock heavily on Friday, forcing it to a one-year low of $39.20 during the afternoon.
Elsewhere, runner maker Nike jumped 7.85 per cent after the company’s quarterly results beat Wall Street estimates. Stock was the biggest driver of gains on the Dow Industrials and S&P 500. – Additional reporting: Reuters