Markets up on both sides of the Atlantic

Markets rose on both sides of the Atlantic yesterday as US President Barack Obama expressed confidence that he will strike a deal with Congress on a new budget to avoid the so-called fiscal cliff.

DUBLIN

The Iseq rose in line with markets across Europe, advancing by 1 per cent, or 33.16 points, to close up at 3,211.23.

Investors responded positively to insurer FBD’s better than expected results. It climbed by 45 cent, or 4.9 per cent, to close up at €9.65, after revealing in a trading update that earnings will be ahead of expectations for the full year.

Index heavyweight CRH was also strong on the day. It added 33 cent, or 2.4 per cent, to close up at €13.93.

Grafton Group advanced by 15 cent or 4.4 per cent to finish up at €3.55, albeit on low volumes.

Smurfit Kappa bounced back, gaining 43 cent, or 5.5 per cent, to finish the day up at €8.40.

Ahead of its egm today, food group Glanbia eased back by 8 cent, or 1 per cent, to close down at €7.78.

LONDON

British stocks advanced the most in more than five months, with the FTSE 100 climbing by 132.07 points, or 2.4 per cent, to 5,737.66 at the close in London, the biggest gain since June 6th.

“A bounce in risk assets, following days of declines, is the first glimmer of life we’ve seen in equities for quite a few sessions,” said Simon Denham, managing director of Capital Spreads in London, adding, “The promise from US politicians that they will work through the Thanksgiving holidays to cut a deal seems to be giving bulls a reason to dip their toes back in.”

BP advanced the most this month after a report that Europe’s second-largest oil company plans a share buyback.

HSBC gained 3.8 per cent to advance to 618.3p after saying it held talks to sell its $9 billion stake in Ping An Insurance, China’s second-largest insurer. Barclays climbed by 6.6 per cent to 249.75p after Goldman Sachs raised its recommendation on the shares to buy from neutral.

Ocado jumped 24 per cent to 75p, after saying it will raise £35.8 million by selling 55.9 million new shares at 64 pence each to existing investors.

EUROPE

European stocks climbed the most in more than two months yesterday, as Germany’s Dax Index gained 2.5 per cent and France’s Cac 40 advanced by 2.9 per cent.

ING rose by 3.8 per cent to €6.76 after the European Commission extended the company’s deadline to sell the insurance businesses. ING pledged to repay state support from the Dutch government by 2015 under an amended restructuring plan.

Scandinavia’s biggest airline SAS soared by 23 per cent to 6.90 kronor after it won the backing of all eight of the unions that represent its employees to cut jobs and shrink the business.

Hochtief jumped by 5.1 per cent to €37.82, snapping a seven-day retreat, after the German builder announced the possible withdrawal of its chief executive officer, Frank Stieler, from the executive board.

Nokia surged by 9 per cent to €2.30 after the company said it received reports that its new Lumia 920 smartphone had sold out in many shops in Germany. Nokia started selling the device, which uses Microsoft’s Windows Phone 8 operating system, earlier this month.

NEW YORK

US markets also rose, giving the Standard Poor’s 500 Index its biggest advance in two months, amid better-than-forecast housing data and as President Obama expressed confidence on a budget agreement with Congress.

There were also signs that the housing market is improving, with sales of previously owned US homes climbing in October, indicating gains in the real estate market are being sustained by cheap borrowing costs.

(Additional reporting Reuters/Bloomberg)