ISEQ index sets record high

THE Irish Stock Exchange entered record-breaking territory yesterday as the benchmark ISEQ index set a new all-time high and added over €1 billion to its value.

The ISEQ hit a new record of 6,954, eclipsing the previous peak reached in October, on the back of strong buying of blue-chip banking and construction stocks. It closed at 6,941.

Bloxham Stockbrokers head of equity research Kevin McConnell said investors had now set their sights on sending the ISEQ through the 7,000 milestone, a barrier that was “very likely to be reached” in the near future.

The ISEQ had recorded steady gains of 15% over the last 12 months and was 12% ahead so far this year, he said. The index had bottomed out at 5,779 in April before rebounding over the summer and rallying strongly in the last three months.

Both major banks were in strong demand yesterday, as Bank of Ireland added 10 cent to €13.21, while AIB teetered near its all-time high at €18.58, a gain of 25c on the day.

Mr McConnell said investors based outside Ireland had been involved in strong buying activity and that the banks were in favour on the back of speculation that there would be no attempt by the government to renew the controversial three-year bank levy in next week’s Budget. The levy, which has hit banks for €100 million each year since its introduction, is due to expire this year.

The positive sentiment towards the banks had also been boosted by impressive results from Bank of Ireland and Anglo Irish Bank last week, said Mr McConnell, who predicted further good news from AIB next week, when the bank is due to issue a trading statement.

Mr McConnell also said there was fresh demand yesterday for cyclical stocks such as building materials giant CRH and no-frills airline Ryanair. CRH gained 33c to close at €22.78, while Ryanair was 21c ahead at €7.36.

The combined value of the companies that make up the ISEQ now exceeds €90bn.

British stocks rose, paced by BP Plc and Royal Dutch Shell Plc as Europe’s largest oil companies rallied from losses after crude prices advanced.

Punch Taverns Plc climbed to a record high after agreeing to buy Spirit Group Ltd to create the biggest British pub company. Egg Plc surged as Prudential Plc offered to buy more shares.

The key FTSE 100 Index gained the most in a month, adding 65, or 1.2%, to 5488.2. Eighty-four stocks rose, 15 fell and three were unchanged.