Wednesday 16 October 2019

ISEQ breaks through 4,000 level as European stocks near peak

Colm Kelpie

IRISH shares pushed higher yesterday despite worrying data about the health of the eurozone economy.

By early afternoon in Dublin, the ISEQ Overall Index had gained 0.86pc, or 34.16 points, to break through the 4,000 mark to 4009.58.

It looked set to be the fourth day of gains for the Dublin index, which largely rose steadily throughout the morning.

The leaders included Ryanair, which increased early afternoon by 3.2pc to €6.34, while rival carrier Aer Lingus gained 3.1pc to €1.49, on the back of strong first half numbers from rival Easyjet.

Drinks giant C&C was up 2.2pc to €4.75, while building material group CRH jumped 1pc to €16.68.

On the other side of the board, the laggards included exploration companies including Petroneft which slipped 7pc to €0.04 and Providence Resources which fell 2.8pc to €5.88.

Speciality baker Aryzta dropped 1.4pc to €48 and shipping and transport company Irish Continental lost 0.5pc to €21.18.

Elsewhere, European stocks rose, extending their highest level since June 2008, after the Bank of England raised its growth forecast for Europe's third-biggest economy, US index futures were little changed, while Asian shares rallied.

The Stoxx Europe 600 Index gained 0.4pc to 306.95 by early afternoon in London.

But the main stocks had slipped early afternoon, with the FTSE 100 down 0.1pc, Germany's DAX down 0.4pc and France's CAC 40 falling 0.4pc.

Stocks had climbed as BoE governor Mervyn King said that an economic recovery in the UK is now "in sight".

In the central bank's quarterly inflation report, which is King's last before he retires in July, officials predicted that growth will accelerate to 0.5pc in the second quarter from 0.3pc in the first three months of the year.

"The market is driven by one thing: the massive liquidity injected by central banks. With bond yields at such levels, equities seem to be the only interesting asset class," said Thierry Jabes, strategist at 360 Asset Managers.

"The reaction to the bad German GDP data is paradoxical. It shows convergence with other eurozone economies, which should help soften Germany's policy stance and create a consensus for further interest rate cuts and stimulus measures."

Commerzbank surged 15pc on the first day that it offered new shares to investors.

Across the Atlantic, US stock-index futures fell and Treasuries rose after manufacturing in the New York region unexpectedly shrank in May.

Irish Independent

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