Fallout from Lehman collapse hits Dublin market

DUBLIN REPORT: Iseq: 4,205.67 (-139.33) Settlement date: September 18thTHE BANKS led the way down as the fallout from the Lehman Brothers collapse on Wall Street hit the Dublin market.

Traders said the Iseq index of Irish shares was down by as much as 7 per cent before lunch yesterday, before and clawing back some of the ground that it lost.

The index finished the day 3.21 per cent down at 4,205.67.

"What's happening in global markets was driving all of it today," one trader said. "The financials were the focus of most of it; there was very little volumes outside of that."

Home-lender Irish Life and Permanentfared worst of the banks. Its price was down 13.33 per cent at €5.85 at the close of trade yesterday. Investors sold more than 1.6 million shares in the financial institution.

AIBwas down almost 6 per cent at €7.506 on the back of trades totalling 4.1 million. Its rival, Bank of Ireland, was down 4.69 per cent at €4.78. More than 5.5 million shares in the bank changed hands in Dublin.

Anglo Irish Bankwas particularly hard hit during the day. By 12.30, its price was down almost 19 per cent at €4.121. However, it bounced back from that to close at €4.65, a fall of 7.74 per cent. Investors sold more than 5.5 million of its shares in Dublin during the day.

Dealers said the Irish financials did slightly better than their peers in Europe. British banks such as HBOS and Royal Bank of Scotland suffered particularly.

The Dow Jones Stoxx 600 Banks Index, which tracks the performance of financials in leading European markets, dropped 6.2 per cent, the most since January, as 60 of 62 stocks declined.

Outside the banking sector, building materials group CRHdropped 3.4 per cent to €18.45. Drinks manufacturer C&Cwas off 2.54 per cent at €2.30. Independent News and Mediawas off 8 per cent at €1.288.