'Successful placing' of Smurfit shares

AS EUROPEAN leaders entered the second day of summit talks on resolving the sovereign debt crisis, talk turned to pro-growth strategies yesterday.

However, markets were flat across Europe, with Dublin one of the strongest performers.

DUBLIN

THE BIGGEST news on the Dublin market yesterday was the placing of 21.6 million shares by paper and packaging firm Smurfit Kappa at a price of €7.30 a share.

While it gave up 6 per cent in early trading following the announcement, it recovered later in the day to close at €7.36, above the placement price, in what was deemed a “successful placing” by one broker.

However, it was still down by 34 cents, or 4.4 per cent on the day, although another broker suggested that given that its underlying business remains positive, he would argue that the stock would go better from here.

Overall, the Irish outperformed its European peers, adding nearly 0.9 per cent.

Ryanair was also active in the market, buying back 9.5 million shares, at an average price of 4.11. It added 3 cents, or 0.6 per cent, to climb to 4.23.

Ahead of its results on Monday, Paddy Power almost touched €45, advancing by 15 cents, or 0.3 per cent, to close at €44.95.

Also out with results on Monday is FBD Holdings. It was also positive on the day, gaining 30 cents, or 3.5 per cent, to close up at €8.90.

Elan gained 35 cents, or 3.7 per cent, to see it climb to €9.75.

Dragon Oil saw heavy trading yesterday and it finished up on the day by 15 cents, or 2.2 per cent, at €7.15.

CC Group benefited from an upgrade from Goldman Sachs and advanced on the news in light volumes. It added 4 cents, or 1 per cent, to finish up at €3.70.

CRH was a little weaker, finishing almost flat at €16.35, up by 7 cents ,or 0.4 per cent.

Also weak was Bank of Ireland, giving up 0.7 per cent to finish at €0.14.

LONDON

IN LONDON, the FTSE 100 lost 0.3 per cent, as Spain raised its budget deficit target above the limit committed to the European Union, and investors worried that rising oil prices will derail a global economic recovery.

Barclays rose by 2.2 per cent to 256.75p after it said that it borrowed money from the European Central Bank to support its units in Spain and Portugal, in the second round of the ECB’s long-term refinancing operation.

IMI advanced 2.2 per cent to 991p after the British engineering company increased its full-year dividend by 15 per cent to 30p a share and reported 2011 sales in line with analyst estimates.

GKN fell 1.8 percent to 218.4p as the company was said to lead a bid to buy Volvo’s aircraft-engine unit after MTU Aero Engines Holding dropped out of the sale process, according to people familiar with the matter.

Rentokil Initial plunged 5.5 percent to 76p after the world’s biggest pest-control company reported full-year pretax profit of £184.4 million, missing the median analyst estimate of £189.7 million.

EUROPE

ACROSS EUROPE, markets remained flat as European leaders committed to a pro-growth agenda even as they signed a deficit-control treaty at the 17th high-level meeting since the outbreak of the crisis.

In a two-day summit that began yesterday in Brussels, euro- area leaders agreed to provide capital faster for the planned permanent bail-out fund in a concession to international pressure to strengthen the region’s defences against the debt crisis.

“The fact that the bailout plan has been validated is good news,” said Bruno Ducros, a fund manager at CamGestion in Paris.

“The problem isn’t resolved, but it gives us time for things to be done. Time is necessary and the measures have been taken. We are on the right path.”

National benchmark indexes rose in 15 of the 18 western European markets, although they moved sideways in most of the larger markets. France’s CAC 40 added less than 0.1 per cent, while in Frankfurt, the DAX declined by 0.3 per cent.

The Stoxx Europe 600 Index rose by 0.1 per cent to 267.

THE US

STOCKS RETREATED in the US, trimming a weekly advance for the Standard and Poor’s 500 Index, amid concern that a rally that drove the benchmark gauge to the highest level since 2008 has outpaced global economic growth prospects.

Energy, industrial and financial shares had the biggest declines among 10 groups in the SP 500.

Anadarko Petroleum, Cummins and Morgan Stanley slid more than 1.6 per cent to pace losses among the largest companies.

Big Lots fell 4 per cent as sales missed estimates.

Yelp, the site that lets users review everything from diners to dentists, gained as much as 73 per cent in its first day of trading. – (Additional reporting: Bloomberg/ Reuters)