Friday 21 October 2016

Carney's remarks drive shares recovery

Bloomberg/Colm Kelpie

Published 01/07/2016 | 02:30

European shares advanced for a third day as investor concerns over the long-term impact of Britain's decision to leave the European Union faded, and the governor of the Bank of England, Mark Carney, said it could loosen policy within months.

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By the close in Dublin, the ISEQ Overall Index was up 0.97pc or 53.95 points to end the trading session at 5,642.49.

The leaders on the Dublin market included speciality baker Aryzta, which increased 4.3pc to €33, while insurance group FBD rose 3.9pc to €5.72.

On the other side of the board, the laggards included insulation group Kingspan, which slipped 3.6pc to €19.50, while Paddy Power fell 1.6pc to €94.50.

Elsewhere, the Stoxx Europe 600 Index gained 1pc to 329.88 at the close. The equity gauge fell as much as 0.9pc in early trading, before recovering to spend most of the session little changed, and then strengthening as Carney spoke.

It has now recouped more than half of the losses caused by Friday's shock Brexit vote.

The volume of shares changing hands was 35pc greater than the 30-day average. The FTSE 100, which on Wednesday erased its post-Brexit decline, jumped 2.3pc to its highest level since August 2015.

"Central banks will flood the market throughout the summer with easy money to make sure no real big accident happens," said Benno Galliker, a trader at Luzerner Kantonalbank in Lucerne, Switzerland.

"The expectation of easy monetary policy across the world is one of the things that works well for the stock market and most European companies aren't affected that much by Brexit as they trade mainly with China and the US."

In his second TV address since the Brexit vote, Mr Carney said the central bank wouldn't hesitate to act to protect the economy or the financial system.

Irish Independent

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