Financials under renewed pressure

A WEAKENING by the major financial shares in the afternoon dragged the market lower in thin trading yesterday, with little impetus coming from overseas markets despite the 41 point rise by the FTSE and a powerful opening burst on Wall Street.

Dealers said that the financials came under renewed selling pressure after their modest recovery on Wednesday. Irish Life probably dealt in the largest volumes and closed down 3 1/4p on 240 1/2p while the two major banks were also weaker, with AIB 5p lower on 315p and Bank of Ireland down 3p on 412p. Other financials were unchanged with Irish Permanent closing on 370p and Woodchester on 185p.

Industrials were little changed and among the leaders CRH was down 2 7/8p on 532p while Smurfit drifted 2 1/2p lower to 157p after its strong run on Wednesday. Overnight weakness in JS Corp shares in New York did not help the Smurfit share. Some of the steam has gone out of Greencore shares, which have traded heavily in recent days, and the shares eased back 4p to 300p. James Crean lost 10p to 225p while Fyffes was Unchanged on 108p after announcing the sale of the Geest banana plantations for $14 million. This sale was welcomed by analysts as a sign that Fyffes is not delaying the sale of the bits of the Geest business that Fyffes/Wibdeco does not want.

Tullow once again was heavily traded with 3.8 million shares dealing in London alone and the share was 2p stronger on 75p in Dublin and up 3 1/4p to 78 1/2p in London.

Gilts were firmer, boosted by what was seen as positive US producer prices figures. The February PPI prices showed a 0.2 per cent fall compared to a forecast 0.1 per cent gain although the figures had little impact on the dollar on foreign exchange markets. Five year gilts closed up 30p to produce a 7.17 per cent yield while 10s were a half point higher, closing on a yield of 8 per cent.