US economy and easing of Greek crisis give global shares a boost
EUROPEAN stock markets notched up broadly reasonably strong performances yesterday after surges on Tuesday that were fuelled by optimism over the US economy and that the crisis in Greece has been allayed. European shares have now hit their highest level since last July.
The ISEQ Overall Index was one of yesterday's gainers, but it yielded some ground just after lunchtime to leave it just nudging into positive territory. It gained 12.52 points, or 0.38pc, to end the session at 3,279.93.
Oil and gas exploration firm Providence Resources put in another strong performance, leading advances for the day.
It gained nearly 11pc, or 50 cent to close at €5.15. It has gained about 63pc in the past two months as the company continues to be bullish about prospects for its activities.
It was reported yesterday that the firm's appraisal well at its Barryroe prospect off the Cork coast has recorded a flow of 2,000 barrels of oil a day equivalent -- more than had been anticipated by the firm.
Other gainers included clinical trials management firm Icon. It rose 7.8pc, or €1.21 to €16.81, while mining firm Kenmare Resources added 2.7 cent, or 4.4pc, to close at 63.6 cent.
Slipping into the red yesterday were stocks including distribution group DCC. It fell almost 1.3pc, or 25 cent, to €19.69.
Food group Aryzta, which had gained 3.2pc on Tuesday after posting results that were slightly below analyst estimates, declined 2pc, or 74 cent, to €36.46 yesterday.
Elsewhere in Europe, Germany's DAX added 1.3pc, France's CAC 40 gained 0.5pc and the UK's FTSE fell 0.1pc.
The Stoxx Europe 600 Index climbed 0.3pc to 270.41. The gauge has gained 11pc so far this year amid optimism that the euro area will contain its sovereign-debt crisis and better-than-expected US economic data.
"The US continues to deliver rather good economic data and the situation in Greece has calmed down for the time being," said Peter Braendle, who helps manage $60bn at Swisscanto Asset Management in Zurich. "For Southern Europe, I hope for further structural reforms, not just saving programmes, but it's certainly a positive impulse for stock markets."
Greece's credit rating was lifted out of the default category by Fitch Ratings on optimism that a debt swap will reduce the risk that the country eventually reneges on its obligations.
Shares in German utility EON increased 7pc to €18.28, the most since December, as it reported 2011 adjusted net income dropped 50pc to €2.5bn, topping the €2.33bn median estimate in a Bloomberg survey. Sales rose 22pc to €113bn.
Home Retail Group, the owner of the Argos and Homebase chains, increased 4.2pct to 114.6p after JPMorgan & Chase raised its rating on the stock rating to 'overweight', the equivalent of buy, from 'underweight'.
In the US the S&P 500 knocked on 1,400 before edging lower yesterday as investors digested the previous session's rally on the Federal Reserve comments on the economy and the banking sector.
Apple shares, up 2.5pc at $582.52, posted a sixth straight day of gains and helped to limit the broader market's losses. Apple's advance came after Morgan Stanley and Canaccord Genuity lifted the price target on the stock to above $700.
The Fed said most of the largest US banks passed their annual stress tests of capital strength in a report that underscored the financial sector's recovery, but called out a few that failed, including Citi.