Markets gain ground as monetary policy remains unchanged

The pain of the markets in January moved a little further into the distance yesterday, with stocks generally stronger as investors prepared for the full launch of the earnings season. Dealers reported decent appetite for risk, with the crisis in emerging markets preying less on shareholders' minds. Monetary policy decisions from both the ECB and the Bank of England resulted in unchanged interest rates.

DUBLIN
The Iseq closed 1.49 per cent higher, with the financial sub-index the best performer. Bank of Ireland was again the busiest stock, climbing by 0.7 cent, or 2.38 per cent, to 30.1 cent. FBD moved slightly in the opposite direction, closing one cent lower at €17.67.

There was little stock-specific news, although both Ryanair and Aer Lingus had passenger numbers. Neither disappointed, while Ryanair's performance was more positive than expected. Shares in the airline finished 18 cent higher at €7.22, while Aer Lingus ended the session 3.5 cent higher at €1.56.

Market heavyweight CRH took some direction from German peer HeidelbergCement, whose update yesterday highlighted challenges in developing markets but positive signs in the US. CRH, which is due to issue results on February 25th, rose by 33.5 cent to €19.055.

Smurfit Kappa gained ground after suffering in the emerging markets trauma. Shares in the paper and packaging group, which will issue numbers next Wednesday, added 73.5 cent to reach €17.585.

LONDON
UK stocks advanced for a second day, rising the most since July, gaining traction from the unchanged interest rates both in Europe and at home.

The FTSE 100 added 100.39 points, or 1.6 per cent, to reach 6,558.28 at the close of trading in London. The benchmark gauge lost 5.7 per cent between its high on January 20th and February 4th amid the selloff in emerging-market currencies, signs of slowing economic growth in China and stimulus reductions from the Federal Reserve. The FTSE All-Share Index rose 1.5 per cent yesterday.

“Risk appetite has returned,” said Jeremy Batstone-Carr, head of research at Charles Stanley in London. “Numbers from the corporate sector have been quite positive. We’ve seen a dissipation of the crisis that has been embroiling emerging markets but it is still an uneasy, fragile calm.”

Vodafone climbed 3.7 per cent after reporting a smaller drop in service revenue than analysts had predicted. Smith & Nephew added 2.5 per cent after the maker of hip and knee implants posted quarterly profit that beat estimates.

EUROPE
Stocks in Europe rose for a second day against the backdrop of an unmoved ECB and and companies including Daimler and Volvo posting earnings that beat estimates.

The Stoxx Europe 600 Index rose 1.4 per cent to 322.59, for its biggest advance since December 19th. The benchmark has fallen 1.7 per cent so far this year.

"After a good correction, markets have gotten a bit better," Pierre Mouton, a portfolio manager at Notz, Stucki and Cie in Geneva, said. Daimler gained 2.5 per cent after saying quarterly profit surged 45 per cent. Volvo climbed 4.8 per cent after reporting better-than-forecast operating profit.

NEW YORK
US stocks rose, sending the Dow Jones Industrial Average towards its best gain this year, as claims for unemployment benefits fell and investors weighed earnings releases of companies from Walt Disney to Twitter.

Coca-Cola advanced 1.5 per cent after agreeing to buy 10 per cent of Green Mountain Coffee Roasters for about $1.25 billion. Green Mountain surged 30 per cent. Disney gained 5.3 per cent after posting quarterly profit that beat estimates. Twitter plunged 21 per cent after reporting a wider-than- projected loss and slowing user growth. (Additional reporting, Bloomberg)