Sunday 23 July 2017

Bank of Ireland share spike bucks market trends

Traders work on the floor of the New York Stock Exchange (NYSE)
Traders work on the floor of the New York Stock Exchange (NYSE)

Sean Duffy

Shares in Bank of Ireland rose almost 7pc yesterday, bucking the wider market trend. The shares surged after the European Central Bank, its regulator, said the bank must maintain a Common Equity Tier 1 ("CET 1") ratio of 8pc on a transitional basis from January 1, 2017. With an existing CET1 of 13pc, it is well above the required level.

It was enough to separate the shares from European peers to end at 21.50 cent, up 6.9652pc, while shares in State-owned AIB lost over 12pc in value.

Markets across Europe closed lower on Thursday as concerns about the results of a referendum in Italy took hold.

Defeat for sitting Prime Minister Matteo Renzi would signal another anti-establishment vote and could trigger the premier's resignation.

The prospect of the eurozone's third-largest economy being governed by an anti-EU party in the near future has spooked investors.

London's FTSE 100 lost 0.45pc, while the French CAC dropped by 0.4pc. Germany's Deutsche Boerse lost 1pc over the course of the day.

However, investors clearly felt that Italian assets had been oversold, with Milan's FTSEMIB the only major index across the continent to post gains (1pc)

Ireland's FTSE 100 was also down, closing at 6171.93, a loss of 43.87 points, or -0.45pc.

It was a mixed day for Irish stocks, Hostelworld was up 6pc, while oil retailer Applegreen gained 5pc. Oil rose more than 4pc on Thursday, with Brent crude at its highest in about 16 months, extending gains after OPEC and Russia agreed to restrict output to speed up the rebalancing of a long-oversupplied market.

OPEC agreed its first oil output reduction since 2008 on Wednesday.

Reuters

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