Financial stocks shrug off warning from Fitch

DUBLIN REPORT: Iseq:2,961.86 (-0.69) Settlement date:August 6th

THE IRISH market kept its head yesterday as bourses around Europe lost their cool and retreated from recent highs.

The Iseq index wavered during the afternoon session but regained its footing by the closing bell to finish virtually unchanged 2,961.86. The Iseq outperformed its European peers for much of the day, although a number of major indexes staged last-minute recoveries.

Financial stocks managed to shrug off a warning from ratings agency Fitch that Irish banks will find fundraising a challenge once the blanket Government guarantee expires at the end of September.

Bank of Ireland picked up in terms of volume yesterday and it advanced towards 89 cents, but its gains had evaporated by the close, leaving it flat at 86.5 cents.

Although most of the trading activity in the banking sector was concentrated on Bank of Ireland, Allied Irish Banks (AIB) proved more liquid than it has been, with about 2.5 million shares changing hands in Dublin.

AIB, which comes under the spotlight today with the release of its interim results, tipped a high of €1 during the session. It sank back a touch into the close, but was still 1.5 per cent ahead on the day.

Irish Life & Permanent pushed on by 3.5 per cent, almost six cents, to just under €1.84.

The resilience in the banking names was counteracted by a weak performance from index heavyweight CRH. The stock came under pressure after the market absorbed a disappointing trading update released by its peer Vulcan Materials after the US close on Monday. CRH succumbed to the ripples of negative sentiment that this sent through the sector, and gave up 1.4 per cent, or 22.5 cents, to close just below €16.31.

Petroceltic International sank almost 7 per cent to 10.5 cent.