MAJOR STOCK markets swung between gains and losses amid volatile trading yesterday as investors weighed European discussions to step up efforts to fight the debt crisis and the US Federal Reserve’s plans to extend its monetary stimulus programme known as Operation Twist.
Europe’s main markets closed higher and the euro gained against the dollar after German Chancellor Angela Merkel said bond purchases by the European Union’s bailout fund are a possibility.
DUBLIN
IN DUBLIN, the Iseq index was largely flat but managed to stay above the psychologically-important 3,000 level. It finished down 0.15 per cent at 3083.
Shares in Aer Lingus, which is the subject of a Ryanair bid, soared 15.43 per cent to close at €1.08.
The airline paced advancing shares as its Irish rival, which already holds a 28.9 per cent stake, said it intends to make a third takeover offer.
Ryanair shares also rose after the news to close at €4.01.
Ryanair said the cash offer of €1.30 per share was prompted by the Government’s plan to sell its 25 per cent holding in Aer Lingus as part of a wider disposal of assets aimed at balancing budgets.
Recruitment firm CPL was up 4.73 per cent to €2.88, First Derivative climbed 13.11 per cent to €6.90 while pharma group Elan finished up 2.08 per cent at €11.27.
There was some weakness in the energy sector with exploration group Providence Resources closing down 4.59 per cent at €5.82 and Dragon Oil declining 2 per cent to finish at €6.81. Petroceltic and Kenmare Resources also finished down.
LONDON
UK STOCKS increased for a fourth day yesterday, extending a six-week high.
The FTSE 100 index fluctuated during the day as investor optimism from Greece’s election at the weekend helped offset a surge in Spanish borrowing costs. The index ultimately added 0.64 per cent to close at 5,622.29 points.
The FTSE 100 has lost as much as 12 per cent from its 2012 high in March as Spanish and Italian borrowing costs climbed and amid concern Greece may be forced to leave the euro area.
The broader FTSE All-Share Index advanced 0.7 per cent.
Evraz Plc, Burberry Group Plc and Wolseley Plc paced advancing shares, all climbing at least 2 per cent.
Quintain Estates and Development Plc jumped 15 per cent after it found an investor to help develop a River Thames project.
EUROPE
EUROPEAN SHARES closed at a fresh month-high yesterday, helped by a rise in bank stocks such as BBVA and Santander, as expectations of new stimulus measures from central banks supported equities.
Spanish banks BBVA and Santander rose 3.4 and 2.7 per cent respectively, although they remain down by 20 and 10 per cent respectively since the start of 2012 due to worries over debts in the Spanish financial system which have necessitated a bailout deal for Spain of up to €100 billion.
European stocks advanced, sending the Stoxx Europe 600 Index to its highest level in more than a month, amid speculation the Federal Reserve will expand Operation Twist to help sustain economic growth.
Hennes and Mauritz AB, Europe’s second-largest clothing retailer, rose 4.8 per cent after earnings topped forecasts.
Unilever NV declined after Proctor and Gamble, the world’s largest consumer-products maker, cut its earnings forecast.
In Paris, the CAC 40 gained 0.285 to 3,126.52 points, while in Frankfurt, the DAX 30 rose 0.45 per cent to 6,392.13 points.
US
US STOCKS fell in volatile trading but recovered most losses after the Federal Reserve said it would extend its monetary stimulus to revive a flagging economy.
The Federal Reserve will expand its Operation Twist programme to replace short-term bonds with longer-term debt by $267 billion through the end of the year in a bid to reduce unemployment and protect the expansion.
Adobe Systems Inc, the world’s largest maker of graphic design software, slid 3.7 per cent to $31.68 after forecasting sales and profit that trailed some estimates.
Procter and Gamble Co also fell 3.4 per cent to $60.07 after the consumer-goods company cut its earnings projections. JPMorgan Chase and Co rallied 2.4 per cent.
Financial shares were the days top gainers, with the sector rising 0.4 per cent. Utilities and consumer staples, considered defensive stocks, were the weakest, falling 0.9 per cent and 0.7 per cent, respectively.
The Dow Jones was down 0.53 points, or 0.00 per cent, at 12,836.80. The SP’s 500 Index was down 1.10 points, or 0.08 per cent, at 1,356.88. The Nasdaq Composite Index was up 3.20 points, or 0.11 per cent, at 2,932.96. – (Additional reporting: Bloomberg)
:quality(70)/cloudfront-eu-central-1.images.arcpublishing.com/irishtimes/VR3765MFOBH2NMV2QNICYDF67M.png)