THE market picked up steam again yesterday, breaking through the 2,500 barrier for the first time, driven by buoyant international markets and falling interest rates.
Dealers said while many analysts believed the central bank could have cut a full half-point off the short term facility (STF), the cautious quarter-point cut still boosted sentiment.
A new £350 million gilt launched by the National Treasury Management Agency (NTMA) was not as well covered as the agency must have hoped. There was still a bit of overhang on the 6.5 per cent gilt due in 2001. Traders said it was "priced a bit high".
Financial stocks saw good buying interest on continued favourable sentiment following Bank of Ireland's £600 million takeover of Bristol & West. Interest rate cuts for borrowers also boosted sentiment, although dealers said there was some worry about the narrowing of margins. Bank of Ireland and AIB both confirmed they would be cutting rates early next week.
Bank of Ireland closed up 3p at 452p while AIB closed up 8p at 340p. Other financials also saw gains on the day. Irish Life firmed 2p to 255p, while Irish Permanent put on 3p to 377p. Both announced rate cuts on home loans.
Leading industrial stocks and second-liners also picked up. CRH reached a new high of 585p up 8p while Smurfit put on 3p to close at 175p.
Adare stood out among second- liners. It reached 5O0p up 15p on reports in yesterday's Irish Times that it was on the brink of further acquisitions.
