Stocks at highest level in eight weeks

EUROPEAN EQUITIES bucked global trends yesterday, scaling two-month highs despite mixed manufacturing data from around the world.

Drawing support from policy measures to battle the euro zone crisis, European stocks hit their highest point in eight weeks.

The Iseq Index of Irish shares also closed up, mirroring European trends, but off its earlier highs.

DUBLIN

IN DUBLIN, the Iseq index gained 0.4 per cent to end at 3,161, led by increases in CRH, Kingspan and DCC.

Software company First Derivative was up 13.1 per cent to €6.90, DCC climbed 2.8 per cent to €18.80, while Paddy Power shares advanced 1.65 per cent to stand at €52.40.

Shares in index heavyweight CRH were also up, finishing 2.1 per cent firmer on €15.34.

In the banking sector, both Bank of Ireland and AIB made some ground, adding 7 per cent and just under 6 per cent respectively.

Exploration stock Providence Resources went against the trend, giving up 1.92 per cent to €6.13, while agri-services group Origin Enterprises was also down 2.78 per cent to stand at €3.50.

Kerry Group was another to lose ground, declining 2.9 per cent to €33.59.

LONDON

BRITISH STOCKS advanced, led by a rally in energy and mining companies, as measures of manufacturing from China to Britain and the euro area exceeded economists’ forecasts.

Rio Tinto Group, the world’s third-largest mining company, and BP both gained more than 1 per cent.

Barclays shares jumped 3.5 per cent following the resignation of chairman Marcus Agius. Mr Agius resigned after the bank was fined a record £290 million for trying to rig inter-bank lending rates.

Aviva, the UK’s second-biggest insurer, was 3.7 per cent stronger amid reports the insurer has considered selling some of its divisions.

Elsewhere in the financials, Royal Bank of Scotland recovered 1.7 per cent to 219 pence after sliding 11 per cent of its market value last week.

Sterling was up against the euro at €1.25 as the single currency lost some of the gains it made in the wake of last week’s European summit. London’s FTSE index gained 1.25 per cent to close at 5,641.

EUROPE

EUROPEAN STOCKS rose to their highest level in eight weeks as investors bet central banks will add to measures unveiled by the region’s governments to contain the sovereign-debt crisis.

European leaders are expected to seek assistance from the European Central Bank this week, following moves to calm markets and accelerate the currency bloc’s integration last week. The ECB may offer help on Thursday, with economists expecting an interest rate cut.

BNP Paribas, France’s largest bank, jumped 4.3 per cent to €31.56. Crédit Agricole also moved ahead, by 6.9 per cent, to €3.71, its highest level since May 2nd. Shares in German-based Linde fell after the industrial gas supplier agreed to acquire US-based Lincare Holdings for about $3.8 billion.

The Stoxx Europe 600 Index climbed 1.5 per cent to 254.82 at the close of trading, the highest since May 7th. The gauge rallied 1.9 per cent last week, trimming its second-quarter decline to 4.6 per cent, as policy makers eased repayment rules for Spanish banks and relaxed conditions for possible aid to Italy.

France’s CAC-40 climbed 1.4 per cent. Germany’s DAX also increased, rising 1.2 per cent.

NEW YORK

US STOCKS fell, halting a global rally, while Treasuries and the dollar extended gains as a report showed the US manufacturing sector shrank unexpectedly in June. US equities erased an early advance after the Institute for Supply Management’s manufacturing index fell to 49.7, showing contraction for the first time in almost three years.

The SP’s 500 Index swung between gains and losses near the 1,362 level after last week capping its best June rally since 1999.

WPX Energy dropped 4.5 per cent for the biggest decline in the SP 500 after the exploration company was downgraded by Barclays. United Parcel Service (UPS) dropped 1.1 per cent as the world’s largest package-delivery company was cut by Deutsche Bank.

DuPont, General Electric and Boeing led losses in the Dow Jones Industrial Average, while ATT, American Express and JPMorgan Chase were the strongest performers.

Shares in Best Buy rose after the Minneapolis Star-Tribune reported that founder Richard Schulze is close to making a bid for the electronics retailer.

Shares in Amylin Pharmaceuticals jumped after Bristol-Myers Squibb agreed over the weekend to buy the biotechnology company for $5.3 billion in cash. (Additional reporting: Bloomberg)