Markets hit six-week highs on rates and trade talks optimism

European stocks advanced to six-week highs on Thursday, as dovish signals from the Bank of England and Federal Reserve combined with optimism around trade talks.

The Bank of England’s June meeting saw its monetary policy committee slash second quarter growth forecasts to zero, heading off market fears of any imminent increase.

Dublin

The Iseq index added 0.6 per cent, outperforming the generally positive mood across Europe. Cement-maker CRH, the largest stock on the index, was a key riser, up 1.55 per cent to €28.85, though Ryanair only managed a 0.3 per cent gain to close at €9.94. Cairn Homes was among the climbers, adding 1.2 per cent to €1.20.

Kerry Group advanced 0.75 per cent to €108.10, but fellow food company Glanbia slipped 0.9 per cent to €14.75. Paper and packaging group Smurfit Kappa was another faller, declining 1 per cent to €27.22.

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Financial stocks were also weaker, with Bank of Ireland closing down 0.8 per cent at €4.65 and AIB losing 2 per cent to €3.53.

London

The FTSE 100 saw a sharp rise after the Bank of England statement, and increasing as much as 0.7 per cent in intraday trading before finally closing up 0.3 per cent.

BP and Shell were both up more than 1 per cent as Middle East tensions drove oil prices higher.

Exporter stocks still took a hit as sterling held on to some earlier gains. Reckitt Benckiser, HSBC and AstraZeneca all edged lower.

Precious metals miner Fresnillo led gains with a 5.5 per cent rise, as gold prices hit their highest in more than five years after the statement. British Airways owner IAG and easyJet were up nearly 3 per cent, recovering from steep falls in the last session when HSBC cut its rating on the stocks.

Domino's Pizza Group jumped 11 per cent after a report that the company is expected to appoint internal candidate Andrew Rennie as its new chief executive.

Dixons Carphone recouped some losses to finish down 5.1 per cent after earlier touching a decade-low, as it reported a slump in full-year profit and pointed to worse to come as it struggles in a fierce mobile phone retail market.

Europe

The pan-European Stoxx 600 index finished 0.4 per cent higher. In Germany, the Dax rose 0.4 per cent, while the French Cac 40 posted a 0.3 per cent gain. Italian stocks outperformed, rising almost 0.7 per cent, with analysts pointing to signs the European Commission could hold off on moves to discipline the country over rising debt. Spanish stocks fell 0.25 per cent.

The German market was helped by software company SAP advancing 1.5 per cent after arch-rival Oracle forecast current-quarter profit above estimates.

German food delivery company Delivery Hero jumped 9.7 per cent after raising its full year revenue outlook by €200 million. One high-profile decliner was Deutsche Bank, which slipped 2.6 per cent after a report US federal authorities are investigating whether the German lender complied with laws meant to stop money laundering and other crimes.

US

The S&P 500 index touched an all-time high on Wall Street after the Federal Reserve indicated that it could cut interest rates as early as July to combat growing risks to global and domestic growth.

Oracle Corp led the charge in the technology sector, with shares of the business software maker up 8.3 per cent after it forecast current-quarter profit above estimates.

Boeing gained 0.8 per cent after the planemaker said it is in talks with other airlines for sales of its 737 MAX after receiving a letter of intent for 200 of the grounded airplanes from IAG.

Cruise operator Carnival slid 10.2 per cent, the most among S&P companies, after cutting its profit forecast in light of the Trump administration's sudden ban on cruises to Cuba and weakening demand in Europe. – Additional reporting: Reuters.