European shares lifted by signs of ECB support

Global stock markets climbed for a fourth day and government bond yields around the world hit their lowest levels in years yesterday, driven by the prospect of further cuts in interest rates and more central bank bond-buying to support weak economies.

Signs that the world’s big central banks will go even easier on monetary conditions, extending an era of ultra-low interest rates, have helped drive a recovery for stock markets after a bout of volatility following Britain’s vote to leave the EU.

European shares rose with the European Central Bank (ECB) also reported to be looking at bond purchases.

DUBLIN

Dublin ended the week in positive territory with the Iseq index closing up 1.9 per cent higher at 5,749.96, having rebounded by more than 8 per cent from its lows on Monday.

The main movers yesterday included packaging group Smurfit Kappa, which gained 6.6 per cent to end the week at €21.11, having been oversold in the week.

Ryanair gained more than 4 per cent to end at €11.84 after reports the airline had been buying back its own shares.

Property investment groups have mainly performed strongly in recent days following news that UK-based companies are considering relocating to Ireland. Green Reit ended up 2.6 per cent to €1.42 while Hibernia, which on Thursday said it had acquired three office blocks in Dublin for €51 million, was down slightly at €1.33.

Bank of Ireland, which like other banking stocks across Europe has been under sustained pressure of late, closed down 3 per cent to 17 cents.

LONDON

Britain’s top share index climbed to a 10-month high and recorded its biggest weekly rise in over four years, as hopes of fresh Bank of England stimulus lent momentum to a rebound from the slump that followed last week’s Brexit vote.

The blue-chip FTSE 100 index ended 1.1 per cent higher at 6,577.83 points, rising for a fourth straight session. The benchmark index rose 7.2 per cent this week, the biggest weekly advance since late 2011.

The UK banks index was up 0.9 per cent, helped by a 0.8 to 3 per cent rise in Standard Chartered, HSBC and Barclays.

Precious metals miners were the top gainers on the index, with Fresnillo and Randgold up 7.1 per cent and 4.3 per cent respectively.

EUROPE

European shares rose yesterday, lifted by expectations the ECB would take action to support markets in order to ease worries about Brexit.

The pan-European Stoxx 600 index rose 0.7 per cent, while the FTSEurofirst 300 index climbed 0.8 per cent. The Stoxx 600 rose about 3 per cent over the week, although it remains 4 per cent below its closing level on June 23rd.

Temenos Group climbed 3.1 per cent after the Swiss software maker said Standard Chartered would use its wealth management programme in more than 30 markets.

US

US stocks extended their gains and were up for the fourth straight day yesterday as strong manufacturing data boosted prospects for an improvement in the economy.

The S&P 500 and the Dow were on track for their best weekly gains since October, recovering sharply from a bruising selloff after Britain voted to quit the EU. Investors are now pinning their hopes on central banks easing monetary policy to support global growth.

The Dow Jones Industrial Average was up 29.07 points, or 0.16 per cent, at 17,959.06 in early trading.

The S&P 500 was up 4.78 points, or 0.23 per cent, at 2,103.64, while the Nasdaq Composite was up 22.20 points, or 0.46 per cent, at 4,864.87.

Harley-Davidson's shares were up 12.5 per cent at $50.94, while Netflix rose 5.2 per cent to $94.35.

US stock exchanges will be closed on Monday for the July 4th Independence Day holiday. – (Additional reporting: Reuters)