ISEQ up 0.5pc for day but nerves frayed on aid MARKETS
Published 27/11/2010 | 05:00
The end of an eventful business week yesterday was merely a pause for breath as markets anticipated a major announcement tomorrow evening that is expected to offer specifics in how the crisis affecting the Irish banking system will be tackled.
The ring of fire that has engulfed Ireland also continued to threaten to burn Portugal and Spain, with officials from both countries denying talks were under way to bail out the two euro nations.
Global markets declined and the euro fell against the dollar as investors feared the eurozone crisis is out of control.
Surprisingly, the ISEQ Overall Index managed to limp into the weekend very slightly up on the day, adding over 12 points, or just under 0.5pc, to close at 2,666.70. It was little to cheer about. The index slumped 4.8pc this week as confirmation of the bailout came and details of the Government's austerity plans were unveiled.
Banks were to the fore once more as ratings agency Standard & Poor's downgraded ratings on Bank of Ireland, Allied Irish Banks and Irish Life & Permanent by one notch. It said the standalone creditworthiness of domestically owned Irish banks has weakened. It slashed the rating on Anglo Irish Bank by six notches to junk status. Bank of Ireland and AIB recovered slightly after it emerged that senior bondholders in the banks might be forced to shoulder some losses.
Shares in Bank of Ireland firmed 3.1pc at over 26 cent while AIB closed up 14pc at over 32 cent. Irish Life & Permanent tanked almost 14pc to over 51 cent.
Other movers included financial software firm Norkom. It advanced 14pc to €1.09 after the company confirmed that it's involved in takeover talks with third parties.
Mining firm Kenmare Resources climbed nearly 11pc to end the session at 31 cent.
Smurfit Kappa continued its declining trend, falling 2.5pc, or 18 cent, to €7.05.
The UK's FTSE 100 Index and Germany's DAX Index each lost 0.5pc, while France's CAC 40 Index retreated 0.8pc. Spain's IBEX 35 tumbled 1.8pc.