Stocks rebounded across Europe on Wednesday as investors watched Greece for signs of compromise.
Equities began to recover on reports that Greek prime minister Alexis Tsipras had signalled he would accept creditors' bailout offer if some changes were made to the attached conditions.
However, Germany said it was reluctant to restart negotiations while a referendum about the bailout conditions was still scheduled for Sunday, and stocks later pared gains after Mr Tsipras reiterated his position that Greece should vote to reject the current bailout offer.
Dublin
The Iseq closed up 1.1 per cent, adding 69 points, as investors’ nerves were calmed on news of Greece’s amended negotiating stance.
On a good day for airline stocks across Europe, thanks in part to the falling price of oil, Ryanair advanced 3.9 per cent to €12.29. Insulation group Kingspan closed up 4 per cent at €22.52.
Building materials group CRH, the largest stock on the index, rose 0.7 per cent to €25.50. Agri-business company Origin Enterprises advanced 2.5 per cent to €8.15, while cheesemaker Glanbia gained 1.6 per cent to finish at €17.92.
However, there were falls for Bank of Ireland, fruit distributor Fyffes, Independent News & Media and drinks group C&C.
London
The FTSE 100 index bounced back from five-and-a-half month lows, lifted by airline stocks that were boosted by lower oil prices and a recommendation that a third runway be built at London’s Heathrow Airport. The index of blue-chip stocks closed up 1.2 per cent, though it remains about 7 per cent below a record high reached in late April.
Airlines were among the best performers. EasyJet, British Airways' owner International Consolidated Airlines Group (IAG) and travel group TUI advanced 2.4-3 per cent.
Mid-cap outsourcing company Serco rallied 6.5 per cent after it reaffirmed its profit and sales forecasts for the current year as it continues to overcome a disastrous period of contract problems and scandals.
Speedy Hire, which is also outside the FTSE 100 index, slumped 30 per cent after issuing a profit warning and announcing the departure of its chief executive.
Europe
European shares extended gains after a report that Greece was ready to accept most conditions from its international creditors to clinch a debt deal. However, the status of the deal remained deeply uncertain.
The euro zone’s blue-chip Euro Stoxx 50 index closed up 2.1 per cent after falling 1.3 per cent a day earlier and slumping more than 4 per cent on Monday on alarm about Greece.
The pan-European FTSEurofirst 300 index rose 1.6 per cent, while Germany’s Dax gained 2.2 per cent, having earlier traded 3 per cent higher than Tuesday’s close.
France’s CAC was up 1.9 per cent, supported by a survey showing France’s manufacturing sector grew in June for the first time since April 2014.
Carmakers topped the gainers’ list in Europe, supported by a positive sector note from investment company Exane, which upgraded its stance or raised the price target for Peugeot, Renault, Daimler, Continental, Porsche and Volkswagen.
Shares in Paris-listed Airbus rose 3.7 per cent after China placed an order for dozens of wide-body jets from Airbus in a multi-billion-dollar deal that paves the way for a second European aircraft plant in the world's fastest-growing aviation market
US
US stocks rose sharply in early trading after it appeared likely that Mr Tsipras would make a climbdown, but gains subsided after the Greek prime minister urged a rejection of the bailout deal in Sunday’s referendum.
The dollar gained on news that US private employers had ramped up their hiring in June, a further sign of an improving labour market that adds weight to the notion the Federal Reserve will raise interest rates later this year.
Oil fell below $63 a barrel after Greece defaulted and production levels hit new highs.
In contrast to the positive day for European carmakers, General Motors lost 1.3 per cent after it said sales fell 3 per cent in June. Ford Motor Company slipped 0.9 per cent and was down for a fifth day, its longest losing streak since September.
(Additional reporting: Reuters / Bloomberg)
