Wednesday 26 October 2016

Energy companies give a boost to European stocks

Published 29/10/2015 | 02:30

Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York. Photo: Reuters
Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York. Photo: Reuters

European stocks rose by mid-afternoon yesterday, buoyed by a rebound in energy companies.

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By late afternoon in Dublin, the ISEQ Overall Index was up 0.79pc, or 50.69 points, to 6,439.47.

The leaders on the Dublin exit included packaging giant Smurfit Kappa, which was up 2.8pc to €26.07 by mid-afternoon, while insulation group Kingspan rose 1.2pc to €21.30.

On the other side of the board, the laggards included drinks group C&C, which fell 2.1pc to €3.64, while fruit company Fyffes dropped 0.3pc to €1.56.

Elsewhere, the Stoxx Europe 600 Index added 1.1pc at 3:04pm in London.

All 19 industry groups rose, with oil-and-gas companies leading gains and snapping a three-day decline.

The benchmark index has climbed 8.1pc in October, rebounding from a quarterly rout and set for its best monthly gain since 2009.

BP and Royal Dutch Shell added 2.1pc or more as oil rose from a two-month low after industry data showed declines in US fuel inventories and crude stockpiles at the nation's biggest storage hub.

Saipem rallied 11pc after Eni agreed to sell a stake in the oil-services company to Fondo Strategico Italiano.

"It's a general positive mood," said Barthelemy Debray, a fund manager at Old Mutual Global Investors in London. His firm oversees $31bn. "I don't think we'll have much more from the Fed, but markets are being driven by central banks right now, be it the ECB, the BOJ or the Fed. People will look at what's happening there."

Earnings reports and deal activity also boosted some equities. BT Group gained 3.3pc after the UK competition authority provisionally approved its bid to buy EE, owned by Deutsche Telekom and Orange.

Heineken added 3.9pc after its sales growth beat estimates.

Volkswagen, the carmaker plagued by an emissions scandal, rose 4.2pc after its namesake car brand lifted third-quarter margins.

Swedish equities climbed after the country's central bank announced plans to buy an additional 65 billion kronor of government bonds. Assa Abloy and Skanska advanced at least 3pc. The OMX Stockholm 30 Index rose as much as 1.1pc, before adding 0.6pc.

Lloyds Banking Group Plc fell 4.4pc after reporting a bigger profit drop than analysts projected.

Meggitt Plc tumbled 20pc after saying full-year operating profit will be "meaningfully below" the consensus estimate.

Numericable-SFR fell 4.3pc after the French unit of Altice posted a decline in quarterly sales. Altice slid 10pc after cutting its annual earnings forecast.

Hopes that the ECB would expand its own asset purchases in December, combined with a rate cut in China, helped the FTSEurofirst 300 to two-month highs at the end of last week.

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