Irish shares rally on hopes Farage has boosted Johnson’s Brexit deal

Irish shares rallied in the final hours of trading on Monday as Nigel Farage, leader of the Brexit Party in the UK, boosted the chances of Boris Johnson getting his EU withdrawal deal over the line by saying he would not contest Conservative-held seats in the country's upcoming election.

The Iseq – the most Brexit-sensitive national stocks index in Europe – ended trading 0.4 per cent higher at 6,839.82, having spent much of the session under water. The pan-European Stoxx index closed flat, while a rise in sterling sent the FTSE 100 down 0.4 per cent given the dominance of UK exporters in that index.

DUBLIN

AIB rose 3.4 per cent to €2.97 to lead Irish banking stocks higher on the back of the latest Brexit speculation. The bank, which had been rattled in recent weeks by a badly-received trading update, also benefitted from upbeat broker commentary from Goodbody Stockbrokers on Monday.

Permanent TSB added 0.5 per cent to €1.14, and Bank of Ireland gained 0.4 per cent to €4.49.

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"Price action suggests that the possibility of fewer obstacles in the way of an outright Conservative Party majority would be welcomed by sterling buyers," Cityindex analyst Ken Odeluga said. "Given the fact that a bigger parliamentary Tory party could pass Boris Johnson's Brexit deal more easily, uncertainty that has hamstrung Britain's economy would be curtailed."

Glanbia was also in demand, advancing 2.3 per cent to €11.56. Cantor Fitzgerald analysts said the stock had become "unjustifiably cheap" following a sell-off in recent months.

Bucking the trend Providence Resources lost 4.8 per cent, and Malin Corp declined by 2.7 per cent.

LONDON

A mix of rising tensions in Hong Kong, dampened US-China trade sentiment and a firmer pound hit the exporter-heavy FTSE 100. Asia-exposed banks HSBC and StanChart and mining stocks were lower.

The main bourse handed back nearly all the gains it accumulated last week as the latest Chinese data disappointed and US president Donald Trump cast doubt on the progress of trade negotiations with Beijing.

Brexit-sensitive stocks such as housebuilders also cheered the Brexit Party news, with blue-chips Taylor Wimpey, Persimmon, Barratt and Berkeley up 2 per cent to 3.6 per cent.

Small-cap Sirius Minerals ended 8.4 per cent higher, having surged nearly 40 per cent earlier, as the fertiliser-maker produced a revised development plan for its North Yorkshire polyhalite project.

EUROPE

Demand for defensive stocks helped European shares recover from early losses on Monday as investors grappled with issues ranging from violent Hong Kong protests to an inconclusive Spanish election and weak data from China.

Spain’s main IBEX index closed flat after the weekend’s parliamentary election pointed to a legislative stalemate.

European miners took the biggest sectoral hit, down 1.4 per cent after data from top metals consumer China showed producer prices fell the most in over three years in October.

Shares in recent stock market debutant TeamViewer gained 3.6 per cent after the German software company reported a near-doubling in core profits in the third quarter.

NEW YORK

Wall Street’s main indexes were lower in early afternoon trading as prospects of a quick resolution to the US-China trade war dimmed following comments from Mr Trump.

Hopes of a “phase one” trade deal and largely upbeat corporate earnings sparked a rally that helped the three major stock indexes close at record highs on Friday.

Mr Trump said on Saturday that the US would only make a deal if it was the “right deal” for America, adding that the talks had moved more slowly than he would have liked.

Attention now shifts to economic data and Federal Reserve chair Jerome Powell's testimony this week, while a handful of big companies including Walmart, Cisco Systems and Nvidia will also report earnings.

Walgreens Boots Alliance jumped after Bloomberg reported KKR had formally approached the drugstore giant for what could be the biggest-ever leveraged buyout.

Among other stocks Qualcomm fell after Morgan Stanley downgraded the chipmaker to equal-weight from overweight. – Additional reporting, Reuters