Sunday 18 March 2018

Shares rally as confidence grows

Peter Flanagan

Peter Flanagan

IRISH shares rose sharply yesterday, snapping a four-day losing streak, as the country's return to the markets after a near two-year hiatus boosted confidence.

By the close of trading the ISEQ Overall Index had added 1.9pc, or 57.75 points, to reach 3,120.67.

The market was flat for much of the day but surged once it was revealed that the National Treasury Management Agency (NTMA) planned to return to the international bond markets in the afternoon.

The fundraising was ultimately more successful than had been hoped, and is seen as a hugely important symbol ahead of the country's planned full return in 2014.

Some three stocks rose for every one that fell, on what was a particularly strong session.

Elan gained 2.78pc to reach €9.60. The pharmaceuticals firm recovered some of the ground it had lost in recent days after a drug it is developing was deemed to have missed targets on its most recent round of clinical trials.

The banks jumped on the news of the bond auction. Bank of Ireland gained 8.89pc to reach 10c, while Allied Irish Banks added 2.04pc to close at 5c.


There were few changes of note on the other side of the board, although Providence Resources slid 1.49pc to €8.28 a day after saying there was up to 1.6 billion barrels of oil in the Barryroe prospect off the Cork coast.

Elsewhere, European stocks climbed the most in almost a month, halting a four-day selloff, after European Central Bank President Mario Draghi said policy makers will do whatever it takes to preserve the euro.

National benchmark indices rose in 16 of the 18 western European markets yesterday. The benchmark Stoxx Europe 600 Index gained 2.47pc. The UK's FTSE 100 gained 1.4pc, France's CAC 40 jumped 4.1pc and Germany's DAX climbed 2.8pc. Spain's IBEX 35 jumped 6.1pc, while Italy's FTSE MIB surged 5.6pc.

"Policy makers don't want the euro to break up and, ultimately, will take the necessary decisions to ensure that it keeps together," said Kevin Lilley, a fund manager at Old Mutual Asset Managers in London. "Spain really needs bond yields below 5pc for the economy to be sustainable -- policy action has to follow."

Stocks surged after Mr Draghi signalled central bank officials are prepared to do whatever is needed to ensure the euro's survival and act on surging bond yields. "Within our mandate, the ECB is ready to do whatever it takes to preserve the euro," Mr Draghi said during a speech in London.

Peugeot Citroen slid 2pc after it was lowered to two levels below investment grade having posted a widening loss at its automotive division.

Irish Independent

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