Irish Market Report

AIB was the strongest performer on the day, jumping by 78 cents or more than 6 per cent, to €12.98 as it played catch-up with the banking sector generally after lagging in recent days.

The Irish stock market surged by nearly 2 per cent yesterday, lifted by rallies overseas and demand for the two main banks.

Bank of Ireland also closed higher, adding 17 cents to €10.10, as its roadshow to convince investors of the merits of its merger approach to Abbey National continued. However, one leading UK-based broker, Credit Suisse First Boston, came out in Bank of Ireland's favour yesterday, saying it thought the proposed merger terms were attractive to Abbey and they should talk.

Other stocks had a more muted performance. Irish Life & Permanent added five cents to €12.05 while CRH failed to make progress, closing five cents lower at €13.10 despite strong US housing starts data. The figures showed ground-breaking for US housing projects in September hit its highest level since 1986.

A $7.5 million acquisition in Britain left United Drug shares unchanged at €12.10 but ICG shares jumped by 35 cents to €6.10 in the wake of share purchases by directors including Eamonn Rothwell. "It's good news for the share price which is looking incredibly cheap. There is also the possibility of an MBO play there," one trader said.

Waterford Wedgwood remained active with nearly 4.7 million shares changing hands though the share price drifted two cents to €0.33. Arcon shares closed a third higher at €0.04 following good drilling results from its Galmoy property. Shares in Independent News & Media also bounced, gaining nine cents to €1.37.