US stocks rise on trade war truce hopes
Sainsbury’s shakes off negative trading update and Ted Baker stages UK recovery Building materials group CRH and Bank of Ireland Iseq’s best performers
European equities rose after a broad global rally spurred by hopes of an end to the trade dispute between the US and China.
Markets in Asia also advanced after talks in Beijing with US officials concluded earlier yesterday with the world’s two largest economies seeking a truce in their long-standing row.
The Iseq index finished almost 1 per cent higher, adding to Tuesday’s 0.5 per cent gain, as the majority of its main stocks climbed. Building materials group CRH added 2.3 per cent to close at €24.45, while Bank of Ireland was 2.7 per cent higher at €5.00.
Cairn Homes closed up 1 per cent at €1.21, while food group
Glanbia was 2.8 per cent higher at €17.06. Paper and packaging group Smurfit Kappa advanced 1.9 per cent to €25.04, and drinks company C&C nudged up 1.2 per cent to €2.94.
However, Ryanair dropped 1.2 per cent to €10.48, while the real estate investment trust stocks Green Reit and Hibernia Reit both ended in the red.
The FTSE 100 ended 0.7 per cent higher, after hitting its highest level since December 5th, while the mid-cap index rallied 1.3 per cent also to levels not seen since early last month.
The London market was buoyed by the more optimistic feeling on global trade tensions as well as a positive trading update from housebuilder Taylor Wimpey, which offset the ongoing uncertainty over Brexit and figures showing a slowing of UK productivity growth.
Housebuilders led the gains after Taylor Wimpey maintained its 2018 results forecast and predicted solid 2019 sales. Its shares advanced 6.2 per cent, taking peers Berkeley, Persimmon and Barratt up with them. Supermarket chain Sainsbury’s recouped initial losses to close 2.3 per cent higher after its chief executive reiterated his confidence that its Asda takeover deal will be cleared. It had earlier slipped almost 3 per cent on a disappointing Christmas quarter update. Vodafone was the biggest drag on the FTSE 100 with a near 2 per cent fall as investors chose more cyclical sectors. Among mid-caps, fashion retailer Ted Baker stole the show with a 31.2 per cent surge on robust holiday period sales and an HSBC upgrade that helped it bag its biggest intraday gain since floating in 1997 and recover losses since it announced an investigation into alleged conduct by chief executive Ray Kelvin.
IT infrastructure and service provider Softcat jumped 17.8 per cent after an unscheduled trading update to its best day on record.
The Stoxx Europe 600 index climbed 0.5 per cent to the highest in a month led by carmakers and mining stocks. Germany’s Dax and France’s Cac 40 index both rose more than 0.8 per cent.
Daimler, BMW and Volkswagen were all boosted after progress in trade talks between China and the US. Volkswagen, finished up 2.4 per cent.
Wall Street rallied for a fourth session yesterday propelled by Apple, chipmakers and other trade-sensitive stocks after signs of progress in trade talks between the United States and China. Market participants were also encouraged by strong U.S. jobs data and recent indications the US Federal Reserve is in no rush to raise interest rates.
The S&P technology index rose 1.50 per cent, with Apple
up 1.70 per cent despite a Nikkei report that the company had reduced planned production for its three new iPhone models.
Chipmakers are among the U.S. multinationals with the highest revenue exposure to China.
Shares in Boeing, which also has a large exposure to China, climbed 0.97 percent, The Dow Jones rose 0.39 percent to finish at 23,879.12 points, while the S&P 500 gained 0.41 per cent to 2,584.96. The Nasdaq Composite added 0.87 per cent to 6,957.08.