Profit taking eases market and marks "period of consolidation"

THE Irish equity and bond markets eased slightly as profit taking set in after recent good runs.

Dealers said the equity market had "entered a period of consolidation" with the leading stocks easing back. There were some small gains among the second liners, they noted.

Adare rose 2 1/2p to 527 1/2p although it had traded as high as 540p earlier in the day on news that it was buying Prontaprint for £23 million sterling. Traders said it was a good deal but profit taking dragged the price back.

All the main financial stocks eased. Bank of Ireland fell 2 1/2p to 457p while AIB lost 5p to 335p. Irish Life fell 1p to 254p and Irish Permanent remained flat at 380p.

CRH fell back from recent highs and lost 10p to 583p. Sources close to the company dismissed suggestions that CRH was a potential bidder for British building supplier Meyer.

Smurfit continued to fall, it lost 4p to 165p after going ex dividend the day before. Waterford Foods lost 1p to 100p while Kerry gained 5p to 575p and Golden Vale remained flat at 70p. Traders said volume in Kerry was small.

Navan Resources failed to deal on news that Fidelity International had upped its stake to 3,200,000 shares or 5.6 per cent.

In the bond markets the 10 year paper continued to outperform core European markets. However, the five year slipped and, under performed other European markets.

Traders said the abundance of supply in the five year market after the issue of a new bond last week had led to profit taking.

They also noted the National Treasury Management Agency was expected to announce switching terms into the new bond during the week. However, a spokesman for the agency said it was "not planning to do it immediately".

The benchmark 10 year bond closed at 103.10p to yield 7.41 perk cent from 7.41 per cent a day earlier. The five year due 2000 closed at 104.60 to yield 6.65 per cent, from 6.59 per cent at the previous close. The new five year benchmark due 2001 closed at 98.40 yielding 6.76 per cent from 6.71 per cent the day before.