A rally among mining stocks and better-than-estimated corporate earnings sent European equities to a two-week high on Wednesday. Commodity producers are now up 27 per cent from last month’s low, erasing this year’s losses.
However, some traders cautioned that it was too early to tell if the rebound had the potential to be lasting, citing the short-lived nature of recent gains, amid fragile confidence.
In the US, stocks also rose in early trading.
DUBLIN
The Iseq rebounded 2.9 per cent in line with the bounce in equity values across Europe. All its biggest stocks posted gains. Building materials group
CRH
advanced 4 per cent to €23.12, while
Ryanair
closed up 4.6 per cent at €13.85.
The newly merged bookmaker Paddy Power Betfair finished 5.6 per cent higher at €123.50.
Food group Kerry, which is due to publish its full-year results next Tuesday, advanced 2.5 per cent to €74.51, while dairy group Glanbia gained 3.3 per cent, closing at €17.50.
There were gains too for paper and packaging group Smurfit Kappa, which added 1.9 per cent to €22.52, and building materials company Kingspan, up 2 per cent to €22.65.
LONDON
The FTSE 100 rallied for a fourth straight session as appetite grew for underperforming stocks in the mining sector. The blue-chip index was up 2.9 per cent at its close, taking gains over the last four sessions to almost 9 per cent.
Commodities and mining firm Glencore soared 16.6 per cent, touching its highest level since November, although the volatile stock has lost about two- thirds of its value since May.
Anglo American surged 17.6 per cent, extending a rise from the previous session. Analysts at Deutsche Bank raised their target price on the stock, saying that the plan to sell certain assets was "designed to navigate Anglo to a more manageable gearing level".
Retailer Sainsbury rose 4.8 per cent, also benefiting from a target price upgrade, as analysts at Exane BNP Paribas lifted its recommendation on the stock from "neutral" to "outperform".
EUROPE
The Stoxx Europe 600 Index gained 2.6 per cent as miners posted double-digit gains. Car- makers posted the second-best Stoxx 600 performance, helped by a weakening euro.
The other main movers were Credit Agricole, which jumped 14 per cent, and Schneider Electric, which rallied 9.2 per cent, after their earnings topped projections.
All but one of the 47 members on the Stoxx 600 banking gauge climbed and every western-European national benchmark gained at least 1.7 per cent, with those in Norway and Sweden up 3.5 per cent or more. Greece’s ASE Index and Italy’s FTSE MIB Index, this year’s worst performers, rose 2.5 per cent.
NEW YORK
Wall Street stocks rallied for a third day, with the Dow Jones Industrial Average rising more than 200 points, as the year’s most-battered shares continued to recover.
Priceline Group rose 11 per cent to boost an index of retailers after the online travel agent's results beat estimates, while Expedia added 4.2 per cent. Freeport-McMoRan rallied 17 per cent after filings showed investor Carl Icahn boosted his stake in the copper producer.
Citigroup and Bank of America increased more than 2.5 per cent as lenders extended their best rally in more than four years. Financials, the worst-performing sector year to date, held on to a third day of gains for the first time this year.
GPS gadget-maker Garmin rallied 17 per cent, the most since 2009, after the company reported earnings that beat the estimates. Microsoft and Facebook added at least 2 per cent. Boeing rose more than 2.7 per cent. The aircraft and defence company is on the rebound after its shares plunged to a more than two-year low last week. – (Additional reporting: Reuters/ Bloomberg)
