ISEQ up nearly 8% as banks put in strong performance

SHARE indices rose in 17 of the 18 western European markets yesterday with the ISEQ Index closing up 7.96%.

It was the third day of strong gains in Dublin that saw the market close up more than €4.3 billion on Monday, when the index fell over 3%.

On the ISEQ the banks were the big gainers, even if coming off a very low base.

Bank of Ireland gained over 41% on the day to close at €2.30, one of the biggest moves of the day by any Irish stock.

Anglo also had a good run yesterday, with its shares up over 25% to end at €2.50.

AIB rose 15.31% to €4.21 while Irish Life was ahead by 25.5%, ending up at €2.70 at the close.

Outside the banks, Independent News & Media rose 28% to 64c, boosted by its announcement that it would cut its debt from €1.4bn to €600m though the sale of its Australasian associate, APN.

Ryanair also got some lift from the upbeat finish to the week, increasing 10% to €2.75 as softening oil prices boosted earnings’ prospects for the low-cost carrier.

Also the sharp cut in ECB rates, now being forecast, helped the rally in the Irish banks in particular. Some easing of credit internationally is also helping sentiment.

It is seen as a hopeful sign that the credit crunch that has crippled the global economy is starting to thaw, if slightly.

Evidence of the strong ECB support for the banking system emerged on Thursday when it revealed outstanding euro loans to banks rose to €773.7bn, the largest amount ever, from €753bn a day earlier.

London’s FTSE closed the week up 2%, along with the French CAC 40, while Germany’s DAX rallied 3.4%.

Efforts by central banks internationally to help pull the global economy out of its deepest recession since the Depression has had some impact on confidence allowing the week to end on a positive note, analysts said.