Iseq sheds over €2.6bn in torrid session

Dublin reportOver €2.6 billion was wiped off the value of the Irish market yesterday as concerns about the impact of problems in the US housing market again reared their head.

Positive results from one of the Republic's biggest companies, CRH, failed to provide positive momentum and left one dealer saying that Ireland had become a difficult story to sell.

Sentiment wasn't helped by a research report from Davy, in which the broker lowered its share price targets for the four main Irish banks by as much as 15 per cent, citing the recent turbulence in the credit markets. It also said it may have to lower its estimates for 2008 earnings.

As a result, the banks were particularly badly hit yesterday, with AIB leading the way down. It closed 4.1 per cent, or 79 cent, lower, at €18.59. Bank of Ireland meanwhile fell 3.2 per cent, or 43 cent, to close at €12.92, while Anglo Irish was down 2.8 per cent, or 40 cent, at €13.80.

Irish Life & Permanent fell almost 3 per cent, or 54 cent, to end the day at €17.59 ahead of interim results which will be published this morning. Volumes were decent in all the banks.

Elsewhere, CRH closed down 1.5 per cent, or 46 cent, at €30.85 despite releasing results in line with market expectations. The company reported first-half pre-tax profits of €670 million, an increase of 27 per cent. Revenue was up 21 per cent, at almost €9.7 billion. DCC was also a loser, a move dealers said was prompted by the fact that the firm appeared to be making no progress on the sale of Manor Park Homebuilders. The shares fell 6.8 per cent, or €1.4, to €5.08.

Drinks group C&C was busy, with more than seven million shares changing hands. The stock, which has taken a significant hit in recent days, fell 1.4 per cent, or seven cent, to €5.08.