Markets up as earnings provide cheer

BETTER THAN expected earnings across the US and Europe pushed markets up yesterday, with Apple leading the charge.

DUBLIN

INDEPENDENT NEWS Media was the main news on the Irish market yesterday with its newly appointed chief executive, Vincent Crowley, and chairman James Osborne both in the market to increase their stake in the company. Mr Crowley purchased 150,000 shares at a price of €0.2676, while Mr Osbourne bought 50,000 shares at € 0.265 each. The stock closed up by 1 cent, or 3.1 per cent at €0.27.

Elsewhere it was a good day on the Irish market, as it followed Europe’s lead, closing up by 1 per cent or 32.80 points at 3,211.31.

Having lost 8 per cent into the close on Tuesday, Kenmare Resources recovered some of its losses yesterday, adding 5 cent, or 8 per cent, to advance to € 0.66. DCC also had a strong day, gaining 45 cent, or 2.5 per cent, to climb to € 18.50.

CRH had a good day and it closed up by 11 cent, or 0.7 per cent, at € 15.13.

Bank of Ireland endured two downgrades in the morning, but there were still buyers in the stock amid speculation that it might be included in the MSCI Global Index, which will be announced shortly. It ended the day flat at €0.11.

Kingspan was weak on the day,giving up 18 cent, or 2.3 per cent to fall back to €7.72.

Aryzta was another stock down on the day, as it lost 29 cent, or 0.8 per cent, to close down at €38.20, while ahead of its interim statement next week, insurer FBD retreated by 9 cent, or 1 per cent, to finish the day down at €8.91.

Volumes were “pretty anaemic” across the board, according to one Dublin broker, with the exception of Kingspan, Total Produce and CRH.

LONDON

IN LINE with other markets, the FTSE 100 closed up but the advance was muted, at 0.2 per cent yesterday, due to figures showing that the British economy contracted for a second straight quarter.

Vedanta Resources, the largest copper producer in India, rallied 4.3 per cent for the biggest increase in the FTSE 100, while ARM, which designs chips for Apple’s iPhone and iPad, rose 1.1 per cent after the US company reported profit that exceeded estimates.

Man Group extended yesterday’s rally amid continued speculation the world’s biggest publicly traded hedge-fund manager may be a takeover target. It rose by 2.8 per cent to 95.2 p.

EUROPE

EUROPEAN STOCKS advanced for a second day on the back of strong earnings results.

The benchmark Stoxx Europe 600 Index gained 1 per cent to 256.96 at the close of trading. The measure has advanced by 5.1 per cent this year.

In France, the CAC 40 rallied by 2 per cent, while Germany’s DAX advanced by 1.7 per cent.

Temenos Group, the Swiss banking-software make, soared by 19 per cent as its first-quarter sales beat estimates and it confirmed its full-year outlook.

Swedbank, the largest lender in the Baltic states, was also up as it beat first quarter earning estimates and made more money from its lending business. It jumped by 3.5 per cent to 107.70 kronor.

BNP Paribas and Société Générale, France’s biggest banks, rose 5.6 per cent to €30.88, and 6.3 per cent to €18.26 respectively.

NEW YORK

APPLE WAS the big story on US markets yesterday, after it said that quarterly earnings had almost doubled due to booming iPad sales. It gave the Nasdaq 100 its biggest gain so far this year, as Apple surged by 8.8 per cent.

Apple’s stock dominates major US equity indexes because of its weighting. The stock has recently sold off, partly on fears earnings could disappoint. Yesterday’s rally in Apple shares helped the Nasdaq climb 2 per cent and could propel the market back to 2012 highs hit earlier this month.

Boeing was also strong on the day as its earnings beat estimates after it delivered more commercial jets while pushing production to record levels. Caterpillar, the largest maker of construction equipment, slumped 4 per cent as revenue missed projections.

“The earnings season shows that companies can have good profitability in a low-growth environment. As long as these earnings hold up, I’d say that’s a bright sign for the market,” commented said James Swanson, chief investment strategist at Boston-based MFS Investment Management.

So far this year, the SP 500 has risen by 10 per cent on better than estimated economic and corporate data, and US companies are beating earnings estimates at the highest rate in two years as economic growth at home helps counter a drag from Europe.

“The earnings season is shaping up to be quite a bit better than expected,” said Mike Ryan, the New York-based chief investment strategist at UBS Wealth Management Americas. – (Additional reporting: Bloomberg/Reuters)