World markets gain on optimistic data

European shares end day’s trading higher in wake of upbeat US macro reports

World equity markets and bonds gained yesterday, showing further signs of stabilising from a dramatic sell-off as investors’ view strengthened that major central banks’ monetary stimulus measures would stay in place for the time being. European shares ended higher in the wake of upbeat US macro data which further eased worries over the world’s biggest economy.

It was a positive day in Dublin in line with the rest of Europe, with the Iseq rising 1.1 per cent, or 31.15 points, to 3,957.89. The most traded stocks in Dublin were Kerry Group, Ryanair, CRH, Smurfit Kappa and C&C.

Smurfit Kappa was a star performer, following a "big bounce" according to one stockbroker, finishing up 7.14 per cent at €12.75. Ryanair, described as an underperformer on the day, started quite weak and finished down 0.1 per cent at €7.115. C&C was strong into the close, finishing 3.25 per cent ahead at €4.13. The drinks group has an update next Wednesday leading to renewed interest from buyers.

Bank of Ireland was strong, up 2.52 per cent to just over 16 cent a share at €0.163. Kingspan recovered after struggling recently, closing up 2.05 per cent to almost €10 at €9.95. Kerry Group was up 1.97 per cent to €42.17 and building materials group CRH was down slightly by 0.03 per cent to €15.55.

UK stocks advanced for a third day, heading for their first weekly gain in more than a month, as a rebound in US consumer spending and a drop in jobless claims added to evidence the economy is strengthening.

The FTSE 100 rose 77.92 points, or 1.3 per cent, to 6,243.4, heading for a 2.1 per cent increase this week.

Randgold Resources, a producer of gold in West Africa, gained 1.6 per cent to 4,036 pence. Vedanta, the metals and oil producer, advanced 0.5 per cent to 1,033 pence. BHP Billiton the world's largest mining company, added 1.3 per cent to 1,694.5 pence. Greene King, the UK brewer of Abbot ale, climbed 2.8 per cent to 767 pence after reporting full-year pretax profit of £162 million. ICAP, the world's largest broker of transactions between banks, gained 1.2 per cent to 357.9 pence, erasing an earlier decline of 3 per cent.

European stocks climbed for a third day, the longest winning streak for the Stoxx Europe 600 Index in five weeks, as a report showed that US consumer spending rebounded last month. National benchmark indexes advanced in every western European market except Greece and Norway. France's CAC 40 climbed one per cent, Germany's DAX added 0.6 per cent.

Alcatel-Lucent rose 6.4 per cent as Morgan Stanley recommended the stock. Drax surged 7.3 per cent to 573 pence, after the UK Department of Energy and Climate Change set the subsidy rates for power from renewable energy plants. Paper company DS Smith climbed 5.4 per cent to 252.7 pence after it increased its dividend by 36 per cent to 8 pence apiece and reported full-year revenue and earnings that beat analysts' estimates.

US stocks and commodities rose amid better than estimated economic data and assurances from Federal Reserve officials that the central bank will continue to spur growth if needed. The S&P 500's three-day advance of 2.7 per cent is its best rally since the beginning of the year. The index trimmed its June decline to less than one per cent.

Hewlett-Packard climbed 1.6 per cent to $24.39. Boeing, the world's largest aircraftmaker, rallied 1.7 per cent to $102.47. Home Depot, the largest US home-improvement retailer, added 0.9 per cent to $76.38.

Financial stocks jumped 1.2 per cent as a group. JPMorgan climbed 1.5 per cent to $53.29, Citigroup added 1.7 per cent to $48.42 and American Express rose 1.7 per cent to $75.14 . – (Additional Reporting, Bloomberg/Reuters)