MARKET REPORT: The Iseq index extended its decline yesterday, dragged down by banking shares such as AIB and Anglo Irish Bank. The benchmark index shed 66.51 points to close at 7,820.81.

AIB declined 40 cent, or 2.1 per cent, to €18.95, while Anglo Irish Bank dropped 18 cent, or 1.3 per cent, to €13.55. More than 4.2 million AIB shares exchanged hands. Bank of Ireland stock broke the downward trend by edging up 5 cent, or 0.3 per cent, to €15.08.

"We saw some big international houses take some profit on these stocks," one dealer said. "There are so many people long on Irish banks, it's scary."

Shares of Elan slumped as much as 95 cent, or 8.5 per cent, to close at €10.21, even after its suspended MS drug, Tysabri, received an upbeat editorial in the New England Journal of Medicine.

NCB Stockbrokers said the editorial supported its own view that Tysabri will be relaunched, but that Elan's stock will be influenced by market commentary ahead of the FDA decision on the drug. This week last year, Elan said it was withdrawing Tysabri, causing the drug company's share price to slide.

"This is not one for the faint-hearted," a dealer said. "There is some scaremongering coming from the hedge fund community about Tysabri."

Fruit distributor Fyffes yesterday reported a 27.9 per cent increase in pretax profit for 2005, thanks to high banana prices, and said trading so far this year has been in line with expectations.

As a result, the company's stock climbed 11 cent, or 5.4 per cent, to €2.15.

NCB Stockbrokers cut its adjusted earnings per share forecast for Fyffes's 2006 earnings by 18 per cent to 14 cent from 17 cent, citing a difficult trading outlook and "European banana markets becoming increasingly competitive."

Shares of Readymix also increased, rising 7 cent, or 3.1 per cent, to €2.32.