Stocks rebound on Greek deal optimism

European and US shares rebounded after several negative days of trading, amid optimism that Greece will reach a deal with its creditors.

In Europe, stocks broke a six-day losing streak, while on Wall Street, equities surged after a Bloomberg report that Germany may be satisfied with Greece committing to at least one economic reform to open the door to bailout funds.

“The Germans have officially blinked and off we go,” Michael Block, chief equity strategist at Rhino Trading Partners in New York, told Bloomberg.

DUBLIN

The Iseq index increased 1.6 per cent. Building materials group

CRH

, the largest stock on the index, climbed 3.1 per cent to €25.24, while

Ryanair

advanced 1.7 per cent to €11.75.

Packaging group Smurfit Kappa rose 1.1 per cent to €26.15, while insulation-maker Kingspan closed up 2.3 per cent at €20.35 on a day on which analysts at Davy Research reiterated an "outperform" rating on the stock and suggested a share price of €30 was a "plausible ambition". Some food and beverage sector stocks including C&C, Fyffes and Kerry finished slightly down, but there were few fallers during the session overall.

UK stocks advanced for the first time in five days, with all but five stocks on the FTSE 100 index rallying. The blue-chip index added 1.1 per cent at the close, rebounding from its lowest level in almost three months. The FTSE All-Share index also rose 1.1 per cent.

The grocers were among the best performers, with J Sainsbury climbing 4.5 per cent. It reported a sixth straight quarter of declining underlying sales, but some analysts said the company beat expectations. Tesco and Wm Morrison, meanwhile, rose more than 4.6 per cent.

Standard Chartered gained 5.8 per cent after chief executive officer Bill Winters, on his first day in the job, pledged to strengthen the bank's capital and focus on better returns. Weir Group was down 0.4 per cent after warning of tough conditions for its unit dealing with the oil and gas sector.

The Stoxx 600 rose 1.4 per cent after hitting its lowest level since February on Tuesday. Energy and commodity producers posted the biggest gains, while technology companies fell.

Greece’s ASE Index ended 1.1 per cent lower, with the market closing before the report on Germany’s negotiating stance. Greek banks slid as analysts at Exane BNP Paribas cut its aggregate estimate for 2015 earnings by 10 per cent on higher provisions and the possibility of a debt deal receding into the third quarter.

French IT services firm Cap Gemini underperformed after it raised €505.8 million. Sensor manufacturer AMS slumped 21 per cent following a report in Swiss newspaper Finanz und Wirtschaft that said it had lost a key contract with Apple.

Heidelberg Cement advanced 4.9 per cent after announcing a target to almost double operating profit by 2019.

Wall Street stocks rose, with technology and financial shares leading a rebound from the biggest drop in two months.

All 10 of the Standard & Poor’s 500 Index’s main industries climbed, with tech and financial companies up more than 1.5 per cent.

Intel jumped 2.2 per cent, rising for the first time in eight sessions, since announcing its acquisition of Altera for about $16.7 billion on June 1st. Integrated Silicon Solutions agreed to merger terms with Cypress Semiconductor, which rose 4.4 per cent.

Citigroup and Bank of America climbed more than 1.5 per cent, with Citi on track for its highest level in more than six years. Insurance companies rose the most among 24 industry groups in the S&P500, as they benefited from higher bond yields.

Sears Holdings lost 11 per cent, reaching a four-month low. Shares have lost more than 25 per cent since June 3rd.

–(Additional reporting: Bloomberg / Reuters)