Thursday 29 September 2016

ISEQ gains as European bourses jump on US jobs numbers

Published 03/09/2016 | 02:30

Traders work at their desks in front of the German share price index, DAX board, at the stock exchange in Frankfurt
Traders work at their desks in front of the German share price index, DAX board, at the stock exchange in Frankfurt

European stock markets surged yesterday as investors bet that weaker than anticipated US jobs data released yesterday will delay any interest rate by the US Federal Reserve. It had been expected that the Fed could hike the rate when it meets later this month.

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Non-farm payrolls rose by 151,000 jobs last month, below consensus expectations of 180,000. The unemployment rate did not fall, contrary to expectations, and was unchanged at 4.9pc.

Analysts said that the jobs report made a rate increase in September much less likely, despite more hawkish noises from Fed officials in the last week.

US short-term interest rate futures rose, indicating trader expectations that the Federal Reserve could soon lift interest rates had been reduced.

"Today's non-farm figures may pour cold water on the prospect of a rate rise later this month, despite the Fed's upbeat assessment of the economy in August," said Nancy Curtin, chief investment officer of Close Brothers Asset Management.

US factory orders also posted their biggest increase in nine months.

Ireland's ISEQ Overall Index mirrored gains by European peers. It closed the session just under 1.6pc higher at 6,287.99.

Ryanair put in a strong performance, gaining 3.2pc to €12.69. Packaging giant Smurfit Kappa also performed well, adding 2.2pc to close at €23.18. Other gainers included Cpl Resources, which continued its run after strong full-year results this week. It added 3.6pc to close at €5.70.

The UK's FTSE-100 closed up 2.2pc, while France's CAC-40 was 2.3pc higher. Germany's DAX rose 1.4pc. Movers included mining project management firm Amec Foster Wheeler.

The company said that it is receiving more enquiries. Its shares rose 7pc.

Reuters

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