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European stocks buoyed by German growth prospects

IT was a much better day for European stocks yesterday, including Irish ones, after Germany reported a strong level of business confidence in December and Goldman Sachs said it believed Spain didn't have a solvency problem and the Spanish government would be able to repay its debt.

The ISEQ spiked during the day just after lunchtime but was unable to hold on to that bigger gain.

But the Overall Index still managed to close the session up 19.6 points or 0.7pc at 2845.5.

Movers during the day included food group Greencore.

Its shares dropped 5.2pc, or nearly 7c to €1.20 after Birmingham-based businessman Ranjit Singh Boparan was granted a two-hour extension to 7pm last night to launch a cash bid for Northern Foods, the company that had agreed last November to merge with Greencore.

Shares in Northern Foods had risen 4.1pc by the close in London.

Mr Boparan managed to hammer out an agreement with Northern Foods regarding its pension deficit.

This had been a factor that proved the biggest stumbling block to making a bid. Aer Lingus managed to end the day unchanged at €1.04 after a 3.7pc drop on Thursday amid industrial unrest at the airline and a 16pc fall in Easyjet's shares.

Building materials firm Grafton Group managed to end in positive territory, climbing 1.8pc or almost 7c to €3.71 after having been down well over 1pc earlier in the day.

The giant of the ISEQ, CRH, added almost 2pc, or 29c to close at €15.08, but had been unable to hold on to an earlier gain of as much as 3.6pc.

Germany's Ifo Institute said that the country's business confidence index climbed to a record 110.3 in December, beating expectations and giving further hope that its economic recovery now appears firmly underpinned.

In the UK, it emerged that retail sales there fell the most ever for a December as cold weather deterred shoppers.

National benchmark indices rose in all the 18 western European markets except Denmark and Greece.

France's CAC-40 advanced 1.3pc, the UK's FTSE-100 added 0.6pc and Germany's DAX increased 0.5pc.

Spain's IBEX 35 Index and Italy's FTSE MIB posted the best performances, climbing 1.8pc and 1.4pc respectively.

Irish Independent