Iseq down on agressive sell-off

The Irish market was the victim of an aggressive sell-off late in the day today, as it fell back in the afternoon to finish the day down by 206.54 points, or 6.8 per cent, at 2,853.30.

With interest rate cuts in the Eurozone and the UK already priced in, markets across Europe failed to rally on the back of the news and the Irish market was no exception.

In line with bank stocks across Europe, Irish financials fell back significantly today, dropping by 11 per cent on average, with Bank of Ireland and AIB the worst performers. Brokers say the banks are still being hit by fears over their need to recapitalise, and analysts at NCB said today that once the banks "grasp the nettle and deal with the capital issue, the stocks will bounce".

Having held up the previous day despite its poor results, AIB gave up 79 cent, or 18.4 per cent, to fall back to €3.51, as stockbrokers revised their earnings estimates for the bank. Bank of Ireland was almost as weak on the day, dropping back by 42 cent, or 18.0 per cent, to finish down at €1.92. 

Anglo Irish Bank held up for most of the day, and was actually up by about 6 per cent at lunchtime, but it too weakened later in the day, closing down by 12 cent, or 4.9 per cent, at €2.33.

The relative star performer was Irish Life & Permanent, which was largely flat on the day, adding 1 cent, or 0.4 per cent, to climb to €2.36. 

A steady performer for some time now, CRH gave up €2.26, or 12.7 per cent, to decline to €15.50, amidst fears over its forthcoming results and those of its peer, Lafarge.

Ryanair was again one of the better performers on the exchange, as falling oil points saw the stock close largely flat on the day, down by 1 cent, or 0.3 per cent, at €3.00.

Paper and packaging firm Smurfit Kappa had another strong day, as it added 4 cent, or 2.1 per cent, to climb to €1.96

In the UK, the Bank of England beat expectations by reducing its key interest rate by 1.50 per cent, to 3.0 per cent, its lowest rate since 1955. However, the move had little impact on the markets, with the FTSE 100 declining by 258.32 points, or 5.7 per cent, to 4,272.41.

Across Europe, the European Central Bank's 50 bp cut also had a negligible effect, as markets fell in all 18 western European indices, and the Dow Jones Stoxx 600 dropped by 5.5 per cent to 215.68. In France, the CAC 40 lost 5.9 per cent, while in Germany the DAX sank by 6.8 per cent. 

In the US, stocks fell again, against deepening concerns about the economic outlook and its impact on corporates' earnings. Cisco, News Corp and Tyco Electronics were all losers, as the S&P 500 slipped by 27.68 points, or 2.9 per cent, to 925.09 at 11.32am, while the Dow Jones Industrial Average also declined, giving up 242.85, or 2.7 per cent, to fall back to 8,896.42.