Iseq: 2,959.79 (-43.27) Settlement date: July 11thEUROPEAN STOCKS went into decline yesterday, ending a winning streak, as credit ratings agency Moody's cut Portugal's rating to "junk" status and China increased interest rates.
The Moody’s manoeuvre meant the spreads on the debt of peripheral euro zone nations widened.
Two-year Irish bond yields increased more than 2 percentage points to 15.30 per cent, while 10-year yields rose 88 basis points to 12.43 per cent.
Fears about debt contagion from Greece dragged the Iseq down almost 1.5 per cent, with key stocks CRH, Ryanair and Elan all suffering falls in their share prices.
Buildings material group CRH began the day announcing that it has spent around €186 million on acquisitions in the first half of 2011, during which time it also disposed of €345 million in assets. Its share price closed down 1.8 per cent at €14.75 in line with bearish investor sentiment.
Kerry was one of the few major stocks to buck the trend, ending the day up 20 cent at €30.00, Greencore and Paddy Power also put in positive performances.
Irish Life Permanent ended the day up 1 cent at 4 cent, as the International Swaps and Derivatives Association said sellers of insurance against a default by the company would have to pay out.
The association ruled there had been a restructuring credit event by the company on July 1st, the date on which the banking and insurance group announced an 87 per cent take-up of a heavily discounted offer for its junior debt. A similar ruling was applied in relation to AIB last month.
Minerals producer Kenmare which operates in Mozambiquefell almost 10 per cent to 60 cent after the African state said it planned to revise its mining law. However, brokers subsequently noted that the planned legal change was likely to have little impact on the company’s licences.
