Financials and CRH take toll as Iseq sheds 3.8%

DUBLIN REPORT:Iseq: 2,877.68 (–113.14) Settlement date: July 2nd

WITH RELATIVELY little news flow, the Irish Stock Exchange headed south in line with its European peers, as concerns about debt levels in Europe and signs that global economic growth may be slowing spooked investors.

The overall Iseq Index closed at 2,877.68, a drop of 3.8 per cent.

Given the nature of the concerns, it was little surprise that the financials took the brunt of the fall. AIB, which on Monday got indicative bids for the sale of its Polish subsidiary, was the hardest hit, shedding 9.6 per cent to close on €0.895.

Irish Life & Permanent was also out of favour and was trading down 7.93 per cent to €1.51. It was indicative of the downward trend all day in Dublin that Bank of Ireland’s performance – slipping by 6.13 per cent to €0.689 – was the best of the banks.

Concerns over the sustainability of the recovery rather than debt levels saw CRH off by 7.6 per cent to close on €16.72.

The announcement by airline Ryanair that it is to reduce its capacity out of Britain by 16 per cent this winter did not seem to bother investors too much. The company’s stock was down by just under 1 per cent to €3.60, significantly less than the overall market. Aer Lingus did not fare as well and was trading two cent lower on €0.80.

Stocks in positive territory that were traded in any meaningful amount were an extremely rare commodity yesterday.

The pick of the crop was recruitment group CPL Resources which was up 2.04 per cent to €2.50.

Donegal Creameries also put in a good session, as investors sought the safety of the agri sector, adding eight cent or 3.05 per cent to finish at €2.70.

Traders will be hoping that yesterday’s performance marked end of month profit-taking and will not set the tone for the summer.