Recent gains eroded as ISEQ slumps

THE ISEQ index of Irish shares continued its slow slide yesterday under 2,000 points — losing another 17 points to close at 1,964.

In an all too predictable pattern, the gains of the previous day among the banking stocks were quickly eroded; AIB down 4c to 42c and Bank of Ireland down 1c at 19c — pretty much the same amount they had gained on Monday. Irish Life & Permanent, which publishes full-year results for 2008 this morning, was unmoved yesterday at 72c per share.

This week’s market losses in Dublin follow on from the worst performing February on the Irish Stock Exchange for 25 years.

Last month, the ISEQ fell by 10.3% in its sixth successive monthly decline, bringing its fall to just under 70% for the past 12 months.

Irish financial stocks lost a combined 63% in share value last month, seeing their worst ever month in terms of performance.

As a result, the one-time cornerstone of the Irish market — the financial sector — now just accounts for 3.5% of the total market value.

Two companies which showed good gains yesterday were C&C and CRH, despite both communicating negatively to shareholders. Drinks group C&C reiterated that it is preparing to report significant profit falls for last year and said that market conditions are only likely to worsen, but still managed to see its share price rise 10% to 99c.

Building materials giant CRH reported a 14% fall in annual pre-tax profits yesterday — again fully expected — and warned of a tough year ahead, but still gained 15c to e15.55. Smurfit Kappa Group was the other big climber, rising 14% to e1.40 per share.

In aviation, Aer Lingus was up 2c to 80c, while Ryanair fell 12c to e2.83. There was a small rise of 3c at drug firm Elan — bringing it to e4.51, but office management group Veris remained static at 38c after announcing that it had reached agreement to sell its loss-making logistics and removals division for less than e80,000.

Elsewhere, concern over efforts to strengthen the US economy led to slides on the Dow Jones and the Nasdaq; while there was negativity around the rest of Europe — Paris’s CAC falling 1% to 2,555 and Frankfurt’s DAX down 0.5% at 3,691. Most notably, London’s FTSE down more than 3% to a six-year low of 3,512.