European shares rally ahead of Fed move
European stocks rallied the most since early October yesterday as investors bet that the US economy is strong enough to cope with the Federal Reserve's expected first interest rate increase in almost a decade.
By the close in Dublin, the ISEQ Overall Index increased 1pc, or 66.36 points, to end the trading session at 6,656.32.
The leaders on the Dublin market included insurance group FBD, which increased 4.6pc to €6.80, while insulation group Kingspan rose 2.3pc to €25.17.
On the other side of the board, the laggards included Kerry Group, which fell 1pc to €75, while CPL Resources dropped 1pc to €6.15.
Elsewhere, Tullow Oil helped push energy companies to the best performance of the 19 industry groups on the Stoxx Europe 600 Index after the successful exploration of a well increased the potential size of oil resources in Kenya. Total and Royal Dutch Shell added at least 3.2pc as oil prices jumped.
Carmakers climbed after data from the European Automobile Manufacturers' Association showed car sales in the region increased 14pc in November. Glencore rose 3pc after JPMorgan Chase recommended buying the shares, citing its "credible" strategy update.
The Stoxx Europe 600 Index advanced 2.9pc to 359.58 at the close of trading, snapping a five-day losing streak.
Germany's DAX Index and France's CAC 40 were among the biggest gainers, rising at least 3.1pc. The Stoxx 600 is still down 6.7pc this month, on course for its worst December since 2002 amid a rout in commodities, concern about US monetary policy tightening and disappointment over the extent of European stimulus.
"Everybody knows the Fed will do something on interest rates and they are doing it because the economy is doing well and that's a good sign for equity investors," said Herbert Perus, head of equities at Raiffeisen Capital Management in Vienna.