European stocks hit three-week high
Published 23/02/2016 | 02:30
Commodity producers jumped to their highest levels since the start of December, pushing European stocks to a three-week peak.
By the close in Dublin, the ISEQ Overall Index was up 0.6pc, or 36.84 points, to 6,162.21.
The leaders on the Dublin index included speciality baker Aryzta, which increased 2.9pc to €42.19, and insulation group Kingspan, which rose 2.1pc to €23.84.
On the other side of the board, the laggards included packaging giant Smurfit Kappa, which fell 2.6pc to €21.90, and Kerry Group, which dropped 1.7pc to €71.
Elsewhere, the Stoxx Europe 600 Index advanced 1.7pc, with Glencore, BHP Billiton and Rio Tinto up more than 8pc. In the UK, where the debate over whether to leave or stay in the European Union is in full steam, the FTSE 100 Index climbed 1.5pc. In addition to the rebound in miners, the gauge is benefiting from a tumble in the pound after the mayor of London said he'll campaign for an exit.
"While we still have some pretty big risks out there, the market has sold off so much it was about time we got a bounce back," said Allan von Mehren, chief analyst at Danske Bank in Copenhagen.
"We've seen a turnaround in the commodities sector. Some of the drag from China is also starting to ease. We have a bit further to go in this relief rally."
Commodity producers have rebounded 35pc from their low in January and are now the only industry group up for the year. Last week, they entered a bull market and helped the Stoxx 600 rally the most in a year.
The benchmark gauge has regained 9.3pc since its February 11 low, taking its valuation to 14.4 times estimated earnings from a low of 13.2. It climbed to almost 17 at its peak last year.
In the UK, the FTSE 100 rose for the first time in three days.
Additional reporting by Bloomberg