ISEQ out-performs to buck trend

DUBLIN’S ISEQ index went into record territory early yesterday but ended the day up 23 points at 6,864. Its last record close was towards the end of July, when the Index hit 6956.

Stronger construction shares and positive news for British financial stocks as well as a strong trading statement from Bank of Ireland last week underpinned activity in the Irish market, brokers said.

CRH rose 22 cent to €22.77, having hit €22.90 earlier.

McInerney gained 11c to €8.61 while, Bank of Ireland rose 5c to €13.20. Despite its difficulties, shares in ICG were up 5c to €9.96 as its troubled Irish Ferries division prepared to go before the Labour Court yesterday.

Stuart Draper, head of research at Dolmen Butler Briscoe, said it was a case of “out-performance” as far as the Irish market was concerned.

It was helped by the positive statement from Bank of Ireland last week on the trading front and positive increases in British financial stocks.

Dollar strength against the euro also helped. It rose to $1.19 against the euro as sentiment post the two hurricanes that devastated the south started to improve.

Some economists said the move by the dollar was significant given the oil shocks and the devastation caused by the hurricanes.

The West is becoming increasingly optimistic that it has the capacity to survive the oil shocks. That, and the general optimism for the Irish economy, have conspired to drive the Index close to record highs, said Mr Draper.

Niall Dunne, economist with Ulster Bank Markets, said the buoyancy in the Dublin market reflected the positive outlook for the economy in general and its resilience to cope with oil crisis.

US stocks opened higher yesterday as investors mulled a raft of corporate deals while awaiting key US manufacturing data.

In early trading the Dow Jones was up 9 points to 10,578 and the tech-rich Nasdaq was four points higher at 2,156.

Until Friday, when the September employment figures are due, analysts said the market would most likely stay range-bound.

European stock markets were also up yesterday afternoon, starting the new quarter on a firm note.

Confirmation of a Boots-Alliance Unichem merger provided a boost for investors glad of the good news as a spur to further interest in the market. In London, Boots’ share price leapt 4.60% after earlier surging by over 7%, while Alliance Unichem added 1%. In response, London’s FTSE was up 29 points to 5, 506 by mid-afternoon.

Later in the day it went to 5511.6, an increase of 0.62%.

The Paris CAC added 23 points to stand at 4,623, while the Frankfurt DAX had gained 31 to trade at 5,075.

Mr Draper said the Irish market has been unique in terms of its out-performance of the rest of the indices. Since the high-tech bubble burst, most of the other international markets have stayed well off their pre-bubble highs.

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