Little respite for Iseq as stocks tumble

Dublin report:Negative US economic sentiment sent markets tumbling yesterday morning, and there was little respite over the course of the day, as the American equities sell-off put major Irish-listed and transatlantic-exposed stocks like Anglo Irish Bank and CRH under pressure.

Anglo, under pressure all day, eventually closed down more than 3 per cent at €10.05, while building materials group CRH dropped 2.6 per cent to close at €24.58.

Both stocks underperformed the overall Iseq index of Irish shares, which finished down 116 points, a drop of 1.68 per cent, as global conditions take their toll on Irish stocks, despite their already low valuations.

Ryanair appears to be stabilising, dealers reported. The stock did still drop almost 1 per cent yesterday, finishing down 4 cent at €4.10, but this was a better finish than earlier in the day when it was trading below the €4.00 mark.

The stock is now so cheap that it is trading on the value of its aircraft alone, with no value given to the operating company in its trading price.

Irish Life & Permanent, which is exposed to the sluggish UK mortgage market, fell 3.1 per cent to close down 37 cent at €11.43, but the softening of the three-month euro interbank rate, or Euribor, for the sixth consecutive day will help the bank, and should push it back into earnings growth, according to one dealer.

The recruitment sector stocks CPL and Newcourt were both fallers yesterday, with CPL dropping 6.7 per cent and Newcourt going down 2.9 per cent.

The market is now pricing in a quarter-point interest rate cut by the Bank of England on Thursday, although the expectation is that the European Central Bank will probably leave rates alone for now.