Chinese manufacturing data lifts stocks

Data signalling growth in Chinese manufacturing boosted markets yesterday, helping European stocks to gain ground for the fourth day running.

A purchasing managers’ index released by HSBC Holdings and Markit Economics showed a preliminary reading for China of 50.4 for November, adding to signs that growth in the world’s second-largest economy is rebounding after a seven-quarter slowdown.

That compared with a final level of 49.5 in October. A reading above 50 indicates expansion.

Euro-area factory output contracted outperformed economists’ predictions. The measure of manufacturing climbed to 46.2 this month from 45.4 in October. That beat the average economists’ estimate of 45.6 in a Bloomberg survey

The news helped give momentum to a day that otherwise threatened to be quiet, as the US markets were closed for the Thanksgiving holiday.

DUBLIN

Traders in Dublin said yesterday was quiet, largely due to the fact that US markets were closed for Thanksgiving, but there was some activity in leading stocks.

News that drinks group C&C is buying Tipperary water producer Gleeson’s for €12 million sparked interest in the stock.

It added 3.29 per cent to end the day at €4.05. Its price broke the €4 mark before lunch and remained above it for the rest of the day.

More than 1.4 million of its shares changed hands.

Index heavyweight, international building materials giant CRH, was largely flat, despite reports claiming that it could be the subject of a bid.

The stock added just 0.11 per cent to close at €13.945. Dealers said that investors set little store by the bid rumours.

Ryanair enjoyed a good day, partly sparked by a Barclay’s note upgrading rival, EasyJet. It put on 2.4 per cent to €4.691.

LONDON

SABMiller advanced 6.4 per cent to 2,801 pence, the biggest increase since October 2011. Earnings rose 17 per cent to $3.17 billion, the company said. That compared with the $3.1 billion median estimate of 10 analysts surveyed by Bloomberg.

Daily Mail climbed 11 per cent to 524 pence, its largest rally since April 2009. The company said it will buy back shares for as much as as much as £100 million. It also said its net debt dropped to £613 million in the year ended September 30th, from £719 million 12 months earlier.

EasyJet added 1.7 per cent to 693.5 pence after Barclays raised Europe’s second-biggest discount airline to equal weight, similar to hold, from underweight, saying the company improved both “revenue and non-fuel cost fundamentals.”

Irish-based explorer Fastnet Oil Gas dropped 14 per cent to 23 pence after announcing that it would raise £14.96 million through a placement of new shares at 22 pence.

EUROPE

The Stoxx Europe 600 Index, which tracks leading shares in 18 markets, rose 0.6 per cent to 271.7, a two-week high, at the close. The benchmark has rallied 16 per cent since June.

Alcatel-Lucent surged 16 per cent to 92.5 cents, the sharpest rise since February 2011, after sources said the company was in talks with Goldman Sachs about obtaining a loan to strengthen its balance sheet.

Under terms still being discussed, the bank would grant Alcatel-Lucent funding of an undisclosed amount, while the Paris-based firm would offer some of its assets as collateral, the sources said.

Nokia Oyj climbed 1.3 per cent to €2.52, its highest since August 27th, as Danske Bank raised the stock to buy from sell and more than doubled its price estimate to €2.90. Danske said Nokia’s 2013 outlook continued to improve.

Air France-KLM Group advanced 2.6 per cent to €6.78 and Deutsche Lufthansa rose 4.9 per cent to €12.51. Barclays raised price estimates for both by 58 per cent to €6.30 and 12 per cent to €11.50 respectively, citing lower restructuring risk.

US markets were closed for the Thanksgiving holiday. – (Additional reporting: Bloomberg)