Ongoing woes for Eircom offset gains by B of I

A recovery by Bank of Ireland and further losses by Eircom were the main features of a mixed day on the Irish market. The market may have closed only marginally lower but the ISEQ is down 5 per cent on the week, leading some in the market predict a modest recovery next week.

Bank of Ireland has had a volatile few days with its share buy-back apparently failing to put a floor under the share price. But yesterday the shares staged a strong recovery and dealt up 45 cents to €8.25 (£6.50) - still below the initial buy-back price but a long way ahead of the €7.60 of earlier in the week.

AIB was the busiest stock in turnover terms and fell nine cents to €10.86 (£8.55) after a hectic final hour when the shares traded between €10.94 and €10.83. First Active continued to weaken and fell 10 cents to €2.65 (£2.09) although Irish Life & Permanent bucked the negative trend and closed up 20 cents on €9.30 (£7.32).

Eircom went from bad to worse and lost another 13 cents to €3.67 (£2.89). Irish fund managers, content with being underweight in Eircom as it allows them to outperform the ISEQ, are still not buyers and few are willing to predict when Eircom will reach a level where buyers will return.

Smurfit was marginally easier on €2.88 (£2.27). Reports from Finland indicate that Finnish paper group Myllykoski has offered to buy some of Smurfit Stone's newsprint assets in the US, assets that are part of the planned disposal programme. The Finnish reports state, however, that Myllykoski may face strong competition for the newsprint business from the likes of UPM-Kymmene, Canadian Kruger, Donohoe, Pacifica Papers and Southeast Newsprint.