Heavy trading in AIB and BofI produces contrasting results

Market Report: Financial shares dominated the stock market yesterday with both of the main banks seeing heavy volumes but contrasting fortunes.

Settlement Date: June 17th

More than nine million AIB shares traded in Dublin, as the stock added 30 cents to 12.60, amid rumours that the bank had begun its latest share buyback programme. Speculation that it might be up for inclusion in the FTSE Eurotop 100 index following the quarterly review may also have prompted interest in the stock.

Bank of Ireland, which confirmed the purchase of 1.25 million shares on Wednesday at 10.60 per share, did not fare as well, closing 15 cents lower at 10.50. But Anglo Irish remained strong, adding eight cents to €7.95, while First Active gained seven cents to €4.47 after issuing an upbeat trading statement. Brokers expect to announce marginal upgrades to their full-year forecasts following the statement.

CRH was another strong performer, closing 33 cents higher at 13.73, as it increasingly stood out from its debt-laden peers.

Elan gained 40 cents to 6.90 as an extraordinary meeting approved the sale of Skelaxin and Sonata to King Pharmaceuticals, clearing the way for a key part of the company's disposal programme to go ahead.

Dealers reported good interest in second-line stocks, a trend mirrored in Britain and elsewhere as investor interest moved down the line from the leading stocks.

Among the mid-cap stocks to benefit was Jurys, which was up 17 cents to 7.97, and Kingspan, which added 15 cents to 2.75. There was heavy trading in Waterford Wedgwood, with nearly 13 million shares traded in Dublin, as the stock added one cent to 0.21. Dealers said there were dramatically opposing views toward the shares among investors with some exiting the stock amid fears of further dividend cuts while others are viewing it as a classic cyclical recovery play.