Wednesday 17 January 2018

Stocks rise on Italian debt announcement

Traders work on the floor of the New York Stock Exchange (NYSE)
Traders work on the floor of the New York Stock Exchange (NYSE)

Sean Duffy

European markets rallied over the course of yesterday's trading as investors responded positively to news the European Central Bank (ECB) was considering additional purchases of the Italian government debt in the aftermath of the country's upcoming reform referendum.

The ECB said it may step up purchases of Italian government bonds in the event that Prime Minister Matteo Renzi loses Sunday's vote. Italy's 10-year treasury bonds dropped to 1.97 in the wake of the ECB announcement, while the country's Borsa Italiana rose almost 2pc, outstripping all other European indexes.

Germany's DAX recovered having opened down in early trading. The Frankfurt index was up by 0.42pc in late afternoon. France's CAC surged by over 1pc, while London's FTSE 100 traded down(-0.2pc).

The price of oil tumbled by over 4pc after Iran indicated it would not be participating in an OPEC agreement to curb production.

An OPEC proposal initially agreed in Algiers in September would see producers trim output by about 1.2m barrels a day from October levels. Iran has sought special treatment since ramping up output following years of crippling sanctions.

Dublin's Iseq overall index of Irish shares was flat over the course of the day.

The biggest winners were Providence Resources, which gained over 17pc. Independent News & Media shares were down by 2.6pc.

In the US, latest data shows the economy grew faster than initially thought in the third quarter, notching its best performance in two years, buoyed by strong consumer spending and a surge in soybean exports.

GDP increased at an annual rate of 3.2pc, ahead of the forecast rate of 2.9pc.

Irish Independent

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