Elan jumps 8.4 per cent on sale news

European shares finished firmer yesterday, supported by signs of merger and acquisition activity in the region and by weak US economic data backing the case for central bank stimulus. US stocks fell after the International Monetary Fund cut its American growth forecast for 2014 and warned that a tapering of Federal Reserve stimulus may be risky if not handled properly.

DUBLIN
The Iseq index added 1.1 per cent up 41.98 points to 3,915.54. The most traded stocks were Kerry Group, C&C, Smurfit Kappa, Bank of Ireland and Ryanair.

Elan jumped 8.4 per cent to €10.07. The drugmaker said it has authorised a formal sale process and invited Royalty Pharma to participate. Royalty has offered to buy Elan for $6.7 billion, a bid Elan's board rejected earlier in the week.

Bank of Ireland slid 1.27 per cent to close at €0.16. Minister for Finance Michael Noonan has said the next round of capital stress tests of Irish banks would take place in the first half of next year and not before our EU-IMF bailout programme concludes at the end of 2013.

Permanent TSB fell 9.06 per cent to €0.0029. C&C was one of the major fallers on the day, down 10.72 per cent to €4.24. Buildings material supplier CRH closed up slightly by 0.29 per cent to €15.48. Independent News and Media fell 5.41 per cent to €0.035. The defined benefit pension scheme at the company has a deficit of more than €150 million. Management at the company met unions in recent days to discuss ways to close the deficit.

LONDON
Most UK stocks advanced, sending the benchmark FTSE 100 Index higher for a second day, led by gains in real estate companies after house prices rose to a record last month. The FTSE 100 Index rose 3.63 points, or 0.1 per cent, to 6,308.26.The gauge still lost 1.6 per cent this week, for a fourth weekly drop, its longest stretch of losses in 14 months. Antofagasta rose 1.4 per cent to 904 pence as base metals advanced in London. Glencore Xstrata added 3.2 per cent to 315.9 pence and Rio Tinto increased 1 per cent to 2,786 pence. HSBC, the heaviest-weighted stock on the FTSE 100, slid 1.5 per cent to 680.1 pence for a fifth day of declines. Severn Trent slid 1.4 per cent to 1,760 pence, extending its decline this week to 15 per cent.

EUROPE
European stocks fell for a fourth week, the longest streak of losses in more than a year, as concern grew that central banks may reduce stimulus measures. The Stoxx 600 rose to 13.5 times estimated earnings on May 17th from nine times in September 2011 – the highest valuation since the end of 2009. France's CAC 40 decreased 1.7 per cent and Germany's DAX Index declined 1.5 per cent. Hochtief gained the most in four months after the German builder said it will buy as much as €260 million of its own shares.

Michelin and Cie, Europe's largest tyremaker, added 4.7 per cent after data on its website showed tire demand surged in Brazil last month. Barry Callebaut lost 3.4 per cent after the maker of bulk chocolate sold about $302 million of new shares.

NEW YORK
US stocks fell and the dollar lost ground for a fourth straight session against the yen during trading, extending a recent retreat sparked by worries major central banks may soon start scaling back stimulative policies.

The Dow Jones industrial average lost 75.39 points, or 0.50 per cent, at 15,100.69. The Standard and Poor’s 500 Index was down 5.97 points, or 0.36 per cent, at 1,630.39. The dollar continued its slide versus the yen, heading for a weekly loss of 3.3 per cent, the biggest since July 2009.

DuPont was the Dow's biggest percentage decliner after it fell 2.4 per cent to $52.59 after a brokerage cut its price target on the blue chip stock. JPMorgan Chase shares fell 1.4 per cent to $53.43 and Bank of America shares fell 0.7 per cent to $13.12. – (Additional Reporting, Bloomberg/Reuters)