Shares in CRH soared the most in eight months on Friday, lifting Dublin’s Iseq index, as investors mulled over comments made by the building materials group’s chief executive, in which he said that options to increase shareholder value are under careful review.
Meanwhile, the pan-European Stoxx index held steady at the end of a strong week as a rally in commodities softened, although strong earnings updates boosted shares in Ericsson and Telia.
The Stoxx 600 index ended up 0.7 per cent on the previous week, its fourth straight week of gains, as global markets recovered from a turbulent first quarter.
CRH, the largest company on the Iseq, jumped by 3.4 per cent to €3.40 after chief executive Albert Manifold told The Irish Times in an interview published on Friday that the options of buying back shares or spinning off its key US unit into a separate stock market listing remain under review, even if the latter option has been ruled out in the past.
While analysts at Davy said they believe the odds of a US spin-off are “low”, they noted that Mr Manifold “has highlighted his focus on creating shareholder value and enhancing group returns”. Meanwhile, Investec took his comments on a potential share buyback programme as a “stronger hint”.
The Irish index advanced 0.7 per cent to 6,827.72.
Shares in Independent News & Media surged by 6.3 per cent to 8.5 cent to recover some of the ground lost recently as the group has been involved in legal issues.
Kingspan was also in demand, gaining 3.4 per cent to €36.86, as the buildings insulation group said that its order backlog is strong and recent acquisitions were performing well, even though prolonged winter weather had resulted in a sluggish first quarter.
Bucking the trend, Smurfit Kappa lost 2.3 per cent to €35.80, and Permanent TSB dropped 2.2 per cent to €1.80.
Weaker sterling helped Britain’s FTSE 100 outperform European markets on Friday, while consumer giant Reckitt Benckiser tumbled after disappointing results and Shire declined as Allergan pulled out of the running to acquire the company.
The leading UK stock index closed up 0.5 per cent at 7368.17 points.
Sterling fell after Bank of England governor Mark Carney dampened widespread expectations for an interest rate hike in May.
Reckitt Benckiser shares fell 2.8 per cent after the maker of Dettol products reported that sales growth had missed expectations, including sluggish results at its Scholl footcare brand.
Shire shares fell back 3.9 per cent after Allergan ruled out a bid for the company, whose shares have been on a rollercoaster ride as Takeda Pharmaceuticals and other bidders jostle to acquire it.
Tobacco companies British American Tobacco and Imperial Brands recovered slightly from Thursday’s slump when weak results from Philip Morris in the US dented cigarette makers.
Telia was an outstanding gainer, up 8.6 per cent, after the Nordic telecoms group announced a welcome share buyback plan as first-quarter core earnings slightly topped market expectations.
But ASM International dropped 8.4 per cent after the supplier of wafer processing equipment for the semiconductor manufacturing industry reported a bigger than expected fall in gross margins.
Shares in Metro were the biggest fallers, down 10.8 per cent after the German retailer lowered its earnings outlook due to weak performance at its Russian operations.
US stock indexes were down in early afternoon trading, with Apple leading declines in the technology sector and as energy companies took a hit from lower oil prices after US president Donald Trump’s criticism of Opec.
The Dow Jones Industrial Average was down 0.8 per cent, at 24,456.66, the S&P 500 was off 0.8 per cent and the Nasdaq Composite dropped 1.1 per cent.
Apple fell as Morgan Stanley estimated weak demand for its latest iPhones, adding to fears raised by Taiwan Semiconductor of softer smartphone sales.
However, General Electric jumped after it posted quarterly results that topped estimates and affirmed its 2018 forecasts. – Additional reporting: Reuters, BloombergTags: Albert Manifold, Allergan, American Tobacco, apple, ASM, Bloomberg, Business, CRH, Donald Trump, Ericsson, General Electric, Imperial Brands, Independent News, Investec, Kingspan, Mark Carney, Markets, Permanent TSB, Philip Morris, Reckitt Benckiser, Smurfit Kappa, Stanley Morgan, Taiwan Semiconductor, Takeda, Telia