Iseq unchanged as Glanbia, Kerry and Smurfit Kappa among fallers

Irish shares and the broader European market ended the session on Monday little changed, following a choppy session which saw early gains give way to a sell-off in defensive stocks.

The benchmark Stoxx Europe 600 Index slipped less than 0.1 per cent to 344.26 at the close of trading, after climbing as much as 0.8 per cent.

DUBLIN

In Dublin, the Iseq index started off on a positive footing as investors across Europe were buoyed by solid economic data showing manufacturing and services activity in Germany rose to its highest this month since July, while French manufacturing output jumped at its fastest pace in more than two years.

However, profit taking soon began to set in, with the Irish index falling into the red by mid-afternoon, with so-called defensive stocks among the worst hit.

The Iseq closed virtually unchanged at 6,035.26.

Food companies were among the worst affected. Kerry Group lost 2.4 per cent to €69.40, while Glanbia declined by 3.4 per cent to €14.97.

Smurfit Kappa dropped 1.7 per cent to €20.30 as analyst at Davy shaved its earnings forecasts for the paper packaging group for this year and next as a result of unfavourable movements by sterling and the Mexican peso against the euro as well as rising input costs for cardboard boxes.

Tullow Oil added 4.1 per cent to €3.33, as Deutsche Bank raised its price target for the stock by 25 per cent to £3 (€3.37).

First Derivatives gained 2.9 per cent to €23.10 as Goodbody Stockbrokers reiterated its buy rating on the stock in anticipation of a strong trading update from the company next week.

CPL Resources jumped 4.6 per cent to €5.70 after the recruitment told shareholders at its annual general meeting that it has had a "solid start to the new financial year with net fees continuing to show organic growth".

LONDON

UK stocks also reversed gains after a rally in commodity producers petered out in the final hour of trading, while stocks deemed more immune to the economy declined.

Randgold Resources and Fresnillo fell 2 per cent or more as gold prices declined, dragging a gauge of miners from its highest level since June 2015. A drop in crude prices also weighed on energy shares.

So-called safe haven stocks retreated amid better-than-forecast output data across Europe and the US. Drugmakers AstraZeneca and Shire and United Utilities Group lost at least 2 per cent.

The FTSE 100 slid 0.5 per cent at the close in London, erasing an advance of as much as 0.7 per cent.

Among other shares active on corporate news, Cobham tumbled 13 per cent after the UK aerospace and electronics supplier downgraded its full-year earnings forecast, its third profit warning in less than a year.

EasyJet gained 1.4 per cent after UBS recommended buying the shares. Petra Diamonds Ltd climbed 5.7 per cent after reporting a 30 per cent increase in quarterly production.

EUROPE

Spain’s benchmark IBEX 35 Index jumped 1.3 per cent, the most among western-European markets, after the Socialist Party leadership opted to let acting prime minister Mariano Rajoy take office for a second term, ending a 10-month political impasse.

Spain's Bankia and CaixaBank rose 4 per cent or more, helping a gauge of lenders to the best performance on the Stoxx Europe 600 Index.

Dutch technology group Philips climbed 4.4 per cent, the most since January, after reporting a 14 per cent increase in third-quarter profit.

Fraport rose 3 per cent after the operator of Frankfurt airport said it has applied for an increase in the fees it charges for 2017. Meanwhile, Syngenta slid 5.8 per cent, the most since August 2015, on concern that China National Chemical Corp's $43 billion takeover of the Swiss herbicide and pesticide maker is at risk of regulatory delays in the European Union.

Aixtron tumbled 13 per cent after the equipment supplier to the semiconductor industry said Germany's economy ministry has reopened a review of a takeover by China's Grand Chip Investment.

NEW YORK

US stocks touched their highest levels in two weeks as a flurry of deal activity and strong quarterly earnings boosted investor confidence.

B/E Aerospace jumped 15.4 per cent to $58.40 after aircraft component maker Rockwell Collins said it would buy the company in a deal valued at $6.4 billion plus the assumption of $1.9 billion in debt. Rockwell was down 6.9 per cent at $78.61.

AT&T was down 1.6 per cent at $36.88 after the telecommunications company said over the weekend it would buy Time Warner for $85.4 billion. If approved by regulators, this would be the biggest deal in the world this year. Time Warner Inc was down 2.2 per cent at $87.56.

In mid-afternoon trading, the Dow Jones industrial average was up 0.3 per cent, while the S&P 500 had added 0.33 per cent, and the Nasdaq Composite, 0.79 per cent.

T-Mobile US jumped as much as 7.8 per cent to a more than nine-year high of $50.41, after the wireless provider reported a better-than-expected quarterly profit and raised its forecast for customer additions for the year.

(Additional reporting: Bloomberg, Reuters)