ISE gains despite recession blow
IRISH shares rose again yesterday, climbing for the third day in a row, as European markets continued to rebound from last week's sell off.
By the close in Dublin the ISEQ Overall Index had gained 0.79pc, or 31.15 points, to end the day at 3,957.89.
Despite the heavy selling on global markets since US Treasury Secretary Ben Bernanke signalled an end to his quantitative easing programme last week, yesterday's gain pushed the ISEQ to its highest level since the first week of June.
The market was flat for much of the session but rose sharply after strong consumer data emerged from the US, offsetting the fact Ireland more than likely fell back into recession in the first quarter of this year.
Smurfit Kappa Group was the big winner on the day, gaining 7.1pc to close at €12.75. The packaging giant was boosted by results from rival DS Smith, which beat market expectations.
Drinks maker C&C added 3.3pc to close the day at €4.13. The maker of Bulmers cider in Ireland has been volatile of late, with mixed views on the performance of its US business.
Food stocks enjoyed the session yesterday. Kerry Group rose 2pc to €42.17, while agronomy business Origin Enterprises jumped 2pc to €5.21.
Four stocks fell for every five that rose.
Exploration stocks had a difficult session. Dragon Oil dipped 2.4pc to €6.70, while Petroceltic 3.7pc to €1.57.
Elsewhere, European stocks climbed for a third day, the longest winning streak for the Stoxx Europe 600 Index in five weeks, as a report showed that US consumer spending rebounded last month.
National benchmark indices advanced in 15 of the 18 western-European markets. France's CAC 40 climbed 1pc, Germany's DAX added 0.6pc and the UK's FTSE 100 jumped 1.3pc. The Stoxx 600 climbed 0.7pc.
"Positive reports will be a confirmation that the US economy is indeed in a recovery," said Guillaume Duchesne, an equity strategist at BNP Paribas in Luxembourg.
"From now on, the most important relationship in equity markets will be the link to the economy. We come from a liquidity-driven market to one that is economy driven. Any good news on that side will be positive."
Alcatel-Lucent rose 6.4pc. Morgan Stanley reiterated its overweight recommendation, which is similar to a buy rating, after Alcatel yesterday started a convertible bond issue and bought back debt as part of its strategy to reduce financing costs.
Drax surged 7.3pc, after the UK Department of Energy and Climate Change set the subsidy rates for power from renewable energy plants. The government said it will pay biomass-conversion plants £105 (€126) per megawatts per hour