European shares lifted by positive data on EU recovery

European shares advanced on data indicating that the EU's recovery may be strengthening, though bank stocks suffered on bad news from UK lender HSBC.

DUBLIN

Nutrition and consumer food group Kerry was the star performer after reporting a 7 per cent rise in profits to €750 million for 2016. Its shares climbed 3.87 per cent to €72.50 on the back of the news. More than 480,000 of them changed hands in Dublin on Tuesday.

Outgoing chief executive Stan McCarthy signalled to The Irish Times that the group could have up to €1 billion to spend on acquisitions. The group also named Mr McCarthy's successor, Edmond Scanlon, current chief executive of its Asia Pacific business.

In the same sector, Glanbia, producer of Avonmore milk, which reports on Wednesday, closed 0.58 per cent up at €17.30, but approached the €17.45-mark earlier in the day.

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Property investor Green Reit tumbled 1.3 per cent after reporting that net asset value rose more than 4 per cent in the final six months of 2016. Dealers said that while its numbers were not bad, investors had already priced them into the stock, which had a decent run in the lead up to the announcement.

Bank of Ireland shed 1.29 per cent to close at 23 cent as European lenders generally suffered in the wake of bad news from HSBC.

LONDON

London’s blue-chip index was dragged into the red by HSBC after the bank reported a whopping 62 per cent drop in annual profits on Tuesday.

HSBC was the worst performer on the index, dropping 6.5 per cent or 46.6pence sterling to 665.7p, after posting a worse-than-expected drop in pre-tax profits to £5.7 billion, down sharply on the £15.2 billion for 2015.

The bank blamed a string of one-off charges, such as the sale of its Brazilian operations, as well as hefty write-downs from a restructuring.

Shares in Anglo American fell 9.5p to 1,350p as the mining giant reaped the benefits of recovering commodity prices and a cost-cutting drive, swinging to an annual pre-tax profit of £2 billion.

Capita rose 20p to 534p after the embattled outsourcing group announced it had written off £50 million of historic contracts just two months after warning over profits.

Shares in Plumb Center owner Wolseley fell 18p to 4,997p, despite inking a deal that will see it expand further into Switzerland.

Aircraft engine and car manufacturer Rolls-Royce Holdings rose 24.5p to 732.5p, Sage Group was up 13.5p at 648p, and Worldpay Group gained 4.5p to 272.3p.

Elsewhere, Hargreaves Lansdown fell 41p to 1,322p while Royal Bank of Scotland Group shed 7.1p to 251.8p.

EUROPE

The Stoxx Europe 600 Index added 0.6 per cent at the close. Oil and gas shares rallied the most in two months as OPEC's top official said the group intends to achieve full compliance with supply cuts.

Germany’s benchmark DAX index was up 0.5 per cent, underpinned by a survey showing growth in the country’s private sector picked up in February to reach its highest in nearly three years.

Euro zone private sector and manufacturing growth also unexpectedly accelerated to near a six-year high in February and job creation reached its fastest since August 2007, propelled by strong demand and optimism about the future. Carmakers were amongst the best performers on the back of the news.

French oil storage and distribution company Rubis RUBF.PA was up 5 per cent, the top gainer in the STOXX 600 index, after the company said a would buy Dinesa and its subsidiary Sodigaz, a fuel products distributor in Haiti.

US

Shares of Wal-Mart Stores Inc, Macy’s Inc and other retailers rallied on Tuesday after results from the crucial Christmas season exceeded Wall Street’s pessimistic expectations.

Wal-Mart's stock climbed as much as 4.2 per cent to $72.28, marking its biggest intraday gain since May. Shares of Macy's rose 3.7 per cent, while Home Depot advanced 1.9 per cent. Other retailers, such as Gap Inc, also gained. Investors have been bracing for a tough earnings season.