Global stocks rise as vaccine optimism buoys markets

Global shares rose for the 11th day in a row to reach a fresh peak on optimism about the rollout of Covid-19 vaccines and new fiscal aid from Washington, while tensions in the Middle East drove oil to a 13-month high.

DUBLIN

Euronext Dublin ended the day up 1.2 per cent, with travel and tourism-related stocks performing particularly well.“Optimism around the vaccine fed through into the market,” noted one trader. There were some strong moves across the board, and travel stocks were a bit better.”

Ryanair was up 2.5 per cent at the close of business, while EasyJet and Aer Lingus parent International Airlines Group both ended the day up 6 per cent. Elsewhere, Dalata Hotel Group – the biggest hotel operator in the State – added 5 per cent.

The positive sentiment fed into the banks, with Bank of Ireland and AIB up 2 per cent and 3.5 per cent respectively.

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Building materials company Kingspan recovered from recent travails to add 2.5 per cent to its share price.

Some food stocks struggled, however, with Kerry Group down 2 per cent after it announced plans to acquire Spanish food company Biosearch Life with a €127 million bid. Biosearch Life is based in Granada, Spain, and employs over 150 people. Kerry Group will report results on Tuesday.

LONDON

British stocks rose as mining and energy stocks tracked strong gains in commodity prices and investors were hopeful global vaccine rollouts would quicken the economic recovery this year.

The commodity-heavy FTSE 100 was up 2.5 per cent, clocking its best day in over a month, boosted by miners Anglo American, Rio Tinto and BHP Group and oil producers BP and Royal Dutch Shell.

“Government attempts to manage expectations on Covid-19 better are helpful to the market, which is now probably pleasantly surprised at just how quickly the UK has vaccinated the most vulnerable sections of its population,” said Russ Mould, investment director at AJ Bell.

The FTSE 100 has recovered nearly 34 per cent from its March 2020 lows, led by a raft of stimulus measures, but a surge in infections and recent widespread lockdowns have slowed economic growth. The index has also lagged its US and European peers.

The mid-cap FTSE 250 index added 1.8 per cent, reaching over an 11-month high, with travel group TUI AG gaining the most. The wider travel and leisure sub-index gained 4.3 per cent.

In company news, Rolls-Royce rose 3.5 per cent after appointing Panos Kakoullis, the former head of Deloitte's audit and assurance practice, as its new chief financial officer.

Pub operator Mitchells & Butlers jumped 7.9 per cent after plans to raise £350 million through an open offer of shares.

EUROPE

European shares ended at a near one-year high as major resource stocks benefited from expectations of a swift economic recovery, while Vivendi led gains on its planned capital distribution from Universal Music.

The pan-European Stoxx 600 rose 1.3 per cent to its highest since late February 2020, with Rio Tinto, BHP Group and Anglo American bolstering the index as copper prices leapt to a more than eight-year high.

Banks and energy stocks also climbed as a so-called “recovery trade” sparked demand for sectors that had underperformed the broader index following early 2020’s coronavirus-driven crash.

Metal and oil prices rose as investors bet on fresh US stimulus and major vaccine programs spurring a resurgence in commodity demand.

Vivendi topped the Stoxx 600 with a 19.6 per cent jump after the French conglomerate said it intended to distribute 60 per cent of Universal Music’s capital to investors.

Shares of Groupe Bollore, which has a 27 per cent stake in Vivendi, jumped 14.6 per cent.

The Dax, which is Germany’s main index, closed up by 0.5 per cent, while the Paris-based Cac rose 1.5 per cent. (Additional reporting: Agencies)

US markets were closed on Monday for Presidents Day.