European shares break four-day losing streak

European shares closed higher on Wednesday as signs of a recovery in global manufacturing activity helped chemical and industrial stocks, while the tech sector marked its strongest close in more than 19 years, tracking gains on Wall Street.

Dublin

The Iseq was out of sync with other European indices, closing down 0.5 per cent with banks weighing on the index.

The banking sector was out of favour with investors on Wednesday with Bank of Ireland and AIB both affected. Shares fell 3.1 per cent and 4.4 per cent respectively.

Uniphar was one of the star performers in Dublin, jumping nearly 6 per cent as it announced a 9 per cent rise in pretax profits to €16.4 million and a deal to acquire the Hickey's pharmacy chain.

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Dalata recovered losses, closing 5.7 per cent higher, a day after it lost ground after reporting a €70.9 million first-half loss due to the Covid crisis.

Other movers in Dublin included baked goods group Aryzta, which rose 2.7 per cent, Kingspan, down 2.4 per cent, Kerry, up 2.2 per cent, and Paddy Power parent Flutter, which closed 2.7 per cent lower.

London

London-listed shares rose for the first time in four sessions on Wednesday as a surge in house prices to record highs powered stocks of homebuilders, with Barratt jumping to the top of the FTSE 100.

The blue-chip index and the mid-cap FTSE 250 climbed 1.3 per cent and 0.5 per cent, respectively, with homebuilders marking their best day in nearly two months as data showed house prices jumped 2 per cent in August, the biggest month-on-month increase since 2004.

Britain's top homebuilder, Barratt Developments jumped 8.6 per cent as it forecast better advance sales and more home completions over the coming year, although it scrapped plans for a special dividend payout after annual profit slumped.

Media stocks, beverage companies and personal goods makers were among the other big gainers.

Europe

The pan-European STOXX 600 index rose 1.7 per cent after closing lower for the past four sessions.

The chemicals sector ended at a record high as positive manufacturing data from the euro zone, United States and China this week pointed to a recovery in global factory activity.

Local technology stocks mirrored gains in their US peers, ending at their strongest level since 2001. The sector has been more resilient than most through the pandemic, having turned positive for the year by early July.

Italian infrastructure group Atlantia topped the STOXX 600 on hopes that it would clinch a deal over its motorway unit Autostrade per l'Italia.

Belgian real estate firm Aedifica rose 4 per cent after it clocked strong rental income growth over the 12 months to June 30th.

European banks, however, lagged their peers, retreating 0.7 per cent as uncertainty over the pandemic seemed likely to create a shaky credit environment.

Wall Street

The S&P 500 rose on Wednesday for the ninth time in the past ten sessions on a boost from Nvidia and Microsoft, as data showed a moderate increase in US private payrolls last month.

In midday trading, the Dow Jones Industrial Average was up 179.09 points, or 0.63 per cent, at 28,824.75, the S&P 500 was up 18.52 points, or 0.53 per cent, at 3,545.17. The Nasdaq Composite was down 34.08 points, or 0.29 per cent, at 11,905.59.

Nvidia gained 2.7 per cent after several brokerages hiked their price targets on its shares following the announcement of powerful gaming chips in collaboration with Micron Technology and Samsung Electronics.

Macy’s added 1.9 per cent after it reported a smaller-than-expected quarterly loss, as shoppers stuck indoors due to the Covid-19 pandemic bought more apparel using the department store chain’s app and website.

Additional reporting: Reuters