Market report: Share boost in Europe for house builders

DUBLIN

The Irish market performed in line with the rest of Europe on Tuesday. News that residential rents are at an all-time high here sparked investor interest in the Republic's biggest landlord, real estate investment trust Irish Residential Reit. It ended the day 0.35 per cent up at €1.149.

Kingspan, which reported record interim results this week, had another strong day, climbing 3.55 per cent to at €25.26.

Ferry operator Irish Continental Group, whose stock has suffered since the UK Brexit vote, added 2.33 per cent to end the day at €4.83.

On-line accommodation booking agent, Hostelworld, gained 1.68 per cent to €1.932 after reporting that losses fell to €5.5 million from €14.6 million in the six months to June 30th.

Drinks group, C&C rose 1,27 per cent to €3.836. Bank of Ireland added 3.93 per cent to 18.5 cent.

LONDON

Irish-based DIY and builders' merchant, Grafton, added 4.7 per cent to close at 568 pence sterling. The move came on the back of an upbeat day for construction-related stocks in London sparked by positive news form housebuilder Persimmon. It said that pre-tax profits lifted 29 per cent to £352.3 million for the first half of the year. Shares soared 4 per cent to 1870 pence as chief executive Jeff Fairburn said that despite increased uncertainty, customer interest since the UK voted to leave the EU had been "robust".

Investors raced to buy up housing stocks following the update, with Barratt Developments among the biggest risers, gaining close to 5 per cent to 486.2 pence. Berkeley Group and Taylor Wimpey were also on the up, climbing 4 per cent to 2649 pence and 3.8 per cent to 165.1 pence respectively.

Supermarket giant Tesco rose 3.8 per cent to 166.3 pence after emerging as the best performer out of the big four grocers in the latest Kantar Worldpanel figures. Britain's biggest supermarket recorded a sales drop of 0.4 per cent in the 12 weeks to August 14th. The sales update also helped Sainsbury's and Morrisons push higher, up 3.2 pence to 244.9 pence and 1.4 pence to 198.2 pence respectively.

Miners BHP Billiton, Glencore and Anglo American rose 3 per cent to 4.9 per cent.

EUROPE

The pan-European Stoxx 600 ended up 0.9 per cent. Germany's DAX rose 0.9 per cent and France's CAC gained 0.7 per cent, helped by upbeat surveys of economic activity. French economic activity accelerated to levels last seen just before militant attacks in Paris last November. German growth slowed in August but remained robust overall, suggesting Europe's biggest economy would continue to expand. A third survey showed activity in the euro zone was little changed in August, though manufacturers may face a tougher September as new order growth slowed.

UniCredit rose 6.6 per cent on speculation the Italian bank could be close to selling its remaining stake in Polish unit Bank Pekao to beef up its balance sheet. Sources told Reuters the chief executive of Poland's biggest insurer, PZU, would travel to Milan this week to discuss buying a stake in Pekao. Other Italian bank stocks were also in demand. That helped Italy's FTSE MIB index gain 2.5 per cent, outpacing the wider European market.

Swiss PC accessories maker Logitech fell 1.7 per cent, the worst performance in the Stoxx 600 index, after UBS cut its rating on the stock to "neutral" from "buy", citing the risk of sales growth setbacks.

Straumann Holding added 1.4 per cent after the medical device manufacturer raised its full-year revenue guidance.

Schneider Electric rose 1.6 per cent after people familiar with the matter said the power-equipment maker is weighing a sale of DTN, an agriculture news and data service that could be worth as much as $1.5 billion.

NEW YORK

US stock rose on Tuesday, with the Nasdaq hitting a record intraday high, led by technology companies and as robust housing market data strengthened the case for a firming economy.

JM Smucker dropped 7.6 per cent after its quarterly revenue missed estimates. The stock was chiefly responsible for the consumer staples index edging lower.

The defensive utilities sector, which tends to fall as prospects for a rate increase rise, was also in the red.

Best Buy surged 18.5 per cent after the electronics retailer posted an unexpected quarterly profit.

Additional reporting: Bloomberg/Reuters