Global stocks rise on upbeat US data

GLOBAL STOCKS rose yesterday on upbeat US data and earnings, while investors cautiously awaited signs that Spain was preparing to formally request a bail-out.

However, the lack of detail on forthcoming action from Madrid put pressure on the euro.

DUBLIN

THE ISEQ index of Irish shares ended up pretty much flat on the day, at 3,244, representing a marginal increase of 0.1 per cent.

CRH, the most traded stock on the index yesterday, edged up in line with the market, finishing at €13.90, a gain of 4 cent. Smurfit Kappa was also well-traded yesterday. The packaging group closed off 1.2 per cent at €8.06.

Tullow Oil, which is traded in Dublin and London, closed at €17.626 in Dublin, and up 11 pence at £14.15 in London, after the exploration company announced it is taken a 40 per cent stake in a licence in Greenland as part of an agreement with Maersk Oil.

LONDON

BRITISH STOCKS advanced, after falling the most in two weeks, boosted by strong retail sales from the US. The FTSE 100 Index rose 12.29 points, or 0.2 per cent, to 5,805.61 at the close in London.

Rentokil Initial climbed 2 per cent after a report said that it may sell or close its City Link unit. The world’s biggest pest-control company said in August it expects City Link to turn profitable in the fourth quarter.

Bovis Homes gained 1.9 per cent to 504 pence after JPMorgan raised its recommendation on the shares to overweight, the equivalent of buy, from neutral.

Optos jumped 6.2 per cent to 209 pence after the company said full-year sales will be more than $190 million, following a strong fourth quarter, exceeding the average analyst estimate of $189.2 million.

Most financial stocks advanced, with HSBC increasing 0.8 per cent to 600.3 pence, while Standard Chartered added 2.4 per cent to 1,461.5 pence.

Lloyds Banking Group gained 1.6 per cent to 40.32 pence and Barclays climbed 2 per cent to 236.85 pence. RBS declined 1 per cent to 268.1 pence after Britain’s biggest government-owned bank said in a statement it will start a new process to dispose of its UK branches after a discussion with the European Commission. Santander on October 12th cancelled an agreement to buy 316 RBS outlets, a deal valued at about £1.7 billion.

EUROPE

EUROPEAN STOCKS climbed amid an increase in mergers and acquisition activity and as a US report showed retail sales rose more than forecast in September.

National benchmark indexes gained in 15 of the 18 western European markets. France’s Cac-40 climbed 0.9 per cent, while Germany’s Dax advanced 0.4 per cent.

Orkla jumped 3.4 per cent after agreeing to combine units with Norsk Hydro. The new entity will have sales of 47 billion kroner ($8.2 billion) and some 25,000 employees.

Douglas jumped 8.1 per cent to €37.62 , the biggest increase since January, after Advent made an offer of €38 per share for the German cosmetics retailer via investment vehicle Beauty Holding Three. The retailer’s three largest shareholders have a binding commitment to accept the bid, Advent said.

Vivendi rallied 2.8 per cent to €15.73. Europe’s biggest media and telecommunications company is in talks to merge SFR with Numericable, Le Journal du Dimanche reported, citing unidentified people. The merger would bring €1 billion in savings and Vivendi would keep a 49 per cent stake in the new entity, according to the report.

Stocks fell in Europe last week after the International Monetary Fund and the World Bank lowered economic-growth forecasts and companies predicted their earnings will miss estimates.

NEW YORK

US MARKETS were heading for a higher close, as data showed retail sales climbed 1.1 per cent in September, beating the median economist forecast for a 0.8 per cent gain. That followed a revised 1.2 per cent increase in August, the Commerce Department figures showed.

Better than expected results from Citigroup also boosted sentiment. Citigroup rose by 4.4 per cent by lunchtime as results benefited from a tax benefit and a surge in bond-trading revenue.

Texas Instruments rose 3.1 per cent on a report Amazon.commay buy its mobile chip unit. Advanced Micro Devices added 2.6 per cent following reports that the second-largest maker of processors for personal computers plans to cut as many as 2,340 jobs, or about 20 per cent of its workforce.

Apple dropped 0.1 per cent to $629.18 as it fluctuated between gains and losses. Shares of the iPhone maker have fallen 10 per cent from an all-time high of $702.10 on September 19th.

Oil fell for a second day in New York as European Union governments agreed further sanctions against Iran’s banking, shipping and industrial sectors.

– (Additional Reporting: Reuters/Bloomberg)