Banks leading charge as new Act lifts ISEQ gloom
There were near 10pc gains for Bank of Ireland
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THE Dublin market enjoyed another exceptional day yesterday with banks leading a continued rebound in share values which recovered a further 5pc of recent losses.
The passing in the Senate of the Government's relief bill for the banks was the prime factor in driving the market. With financial shares once again to the fore, the financial component of the ISEQ ended the day with a gain of almost 12pc against a 1.66pc gain for the general stocks.
But even though the market has now gained ground for three days running -- it has gained more than 16pc since falling to a fresh five-year low on Monday night -- it is still well down on the year.
During the session it was the four banks which came in for solid support, with Anglo Irish Bank gaining most as it finished the day 18pc to the good. Irish Life & Permanent was up over 11pc, while there were also near 10pc gains for both AIB and Bank of Ireland.
The one downer was the poor start to trade on Wall Street, which led to an erosion of some of the early gains in Dublin.
Stocks on Wall Street tumbled from the start and within a matter of minutes the Dow Jones industrials fell 300 points, its fourth straight triple-digit move.
Stocks fell at the opening, then gathered downward momentum after the US government reported that the number of people seeking unemployment benefits rose last week and that demand at the nation's factories has fallen by the largest amount in nearly two years.
The market was reported to be interpreting the Commerce Department report on factories as a sign that tight credit conditions are hitting manufacturers.
The poor jobs data came as Wall Street tried to determine what might come of the government's rescue package, with a House vote expected.
Even if the package is approved traders are sceptical about its ultimate impact on a faltering global economy. Cleaning up the pile of bad debts on banks' balance sheets will be a long arduous process, and the crisis is spreading in Europe, where governments have bailed out two troubled banks, Fortis NV and Dexia.
Despite the poor showing in the US, Dublin managed to hold on to most of its gains. Even after data showing a record decline in short-term borrowing by European companies, the market held on to most of an early 8pc gain to finish 4.99pc up on the day.
- Pat Boyle
