Business Irish

Friday 15 December 2017

Draghi gives European shares a boost

ECB President Mario Draghi. Reuters
ECB President Mario Draghi. Reuters

Bloomberg and Colm Kelpie

For European stock investors seeking assurances of central-bank support after China-fuelled volatility rocked global markets, Mario Draghi didn't disappoint.

Stocks that were already up before the European Central Bank president's press conference in Frankfurt rose higher after he unveiled a revamp of his quantitative-easing programme that allows officials to buy higher proportions of each Eurozone member's debt.

Officials cut forecasts for economic growth and inflation, citing the emerging-market rout as a threat.

"Draghi is really trying to assure the market that the ECB is ready to act and we'll have QE for the next years," said Benno Galliker, a trader at Luzerner Kantonalbank in Lucerne, Switzerland.

"He is doing everything is needed to stabilise the market. QE is here to stay for quite a while."

The Stoxx Europe 600 Index climbed as much as 2.9pc, before closing 2.4pc higher.

The gauge halted a rout yesterday, after posting the worst monthly performance in four years and tumbling further earlier this week amid concern over a slowdown in China.

By the close in Dublin, the ISEQ Overall Index was up 1.85pc, or 116.26 points, to end the trading session at 6,388.92.

The leaders on the Dublin market included recruitment firm CPL Resources, which rose 8.7pc to €6.25 after it said revenues grew by 6.6pc to €394m.

Insurance group FBD rose 5.3pc to €6.15.

On the other side of the board, the laggards included Providence Resources, which slipped 2.2pc to 22 cents, while IFG Group dropped 4.7pc to €1.87.

A gauge of services and manufacturing in the Eurozone climbed to a four-year high in August, a Markit report showed. With Chinese exchanges closed for a holiday, investors also got a respite from market moves there.

Irish Independent

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