European stocks rise on Chinese data

European stocks climbed yesterday as strong Chinese factory data fuelled a rally in mining shares, while buoyant euro zone banks propelled French and Spanish benchmark indices to year highs.

DUBLIN
Bank of Ireland was the star performer of the day, gaining 6.3 per cent to close just above 20 cent for the first time in more than two years. The bank's share price has almost doubled since the start of the year, rising 10 per cent since the bank reported half-year results late last week.

It was also a good day for CRH which climbed 1.6 per cent, Kerry Group which finished up 1 per cent and Petroceltic International which jumped 2.9 per cent.

Ormonde Mining soared 15 per cent following news it had received a takeover approach from Canada's Almonty Industries. However, the board unanimously rejected the proposal.

Dragon Oil, meanwhile, slipped 6.3 per cent to finish the day at €6.60. Earlier this week, the Turkmenistan-focused explorer reported a 20 per cent fall in first-half profit, taking a hit from slower-than- expected progress on infrastructure projects and falling oil prices.

The Iseq Index was up 0.9 per cent or 37 points to close at 4,266.

LONDON
UK-listed miners rose to a two-month high, helping the FTSE 100 index to end stronger, after factory output data from China boosted the demand outlook for raw materials. Sentiment also improved after Britain's construction output grew more than expected, house prices in England and Wales hit an all-time peak and the trade deficit in goods narrowed, reviving expectations of a broader economic recovery.

Shares in Rio Tinto – which according to Morgan Stanley research makes about 46 per cent of its revenue in China – were up 5 per cent at 3,167 pence, having hit a four-month high.

BHP Billiton climbed 3.4 per cent to 1,963.5 pence, while Fresnillo rallied 8.2 per cent to 1,035 pence. Standard Life declined 3.3 per cent as analysts raised concern about the insurer's earnings.

The FTSE 100 gained 53.71 points, or 0.8 per cent, to 6,583.39 at the close in London.

EUROPE
European stocks advanced for a second week, as better-than- forecast economic data in Europe and China outweighed concern that the Federal Reserve will reduce the pace of its bond-purchase programme.

Royal KPN soared 16 per cent to €2.32 after billionaire Carlos Slim's America Movil offered to take over the Dutch phone operator.

Securitas jumped 9.1 per cent after the world's second- biggest guarding-services provider reported quarterly profit that beat analyst estimates.

Nestlé fell 3.2 per cent after posting the slowest first-half revenue growth in four years.

The Stoxx Europe 600 Index rose 0.6 per cent to 305.92 this week. The CAC gained 0.3 per cent to close at 4,076.55 points, surpassing a May peak and hitting its highest level since mid-2011.

Germany's DAX Index dropped 0.8 per cent, while Madrid's IBEX gained 0.7 per cent to 8,735.5 points its highest level since early 2012.

NEW YORK
US stocks fell in early trading yesterday, putting the three major indices on track for their worst week since June, as investors found little incentive to buy with equity prices not far below last week's record levels.

Wall Street has struggled this week, making small moves in light volume, as an absence of trading incentives kept buyers at bay. Comments from Federal Reserve officials, which created confusion over when the central bank would begin to scale back its stimulus policy, further added to uncertainty.

JC Penney, down 7.5 per cent at $12.63, was the S&P 500's worst performer. Home Depot shares dropped 1.4 per cent to $78.89 and ranked among the Dow's biggest percentage decliners. – (Additional reporting: Bloomberg, Reuters)