AIB results send ISEQ lower
IRISH shares fell yesterday, the second day in a row, as Allied Irish Banks' results and more bad news globally sent the market down.
On the day, the ISEQ Overall Index dropped 0.73pc, or 21.25 points, to 2,909.48. The sell-off began as soon as the market opened, with AIB's €10bn annual loss dominating the news-flow for much of the day.
Unsurprisingly, AIB was the laggard throughout the session and closed down 12pc at 22c. AIB's loss of €10.4bn and the 2,000 jobs that will be axed were a product of the crazy property lending of the boom, said executive chairman David Hodgkinson, who added that he hoped the bank would return to profit next year.
The bank's loss inevitably spilled over to Bank of Ireland, which reports its results tomorrow. The bank was the fifth worst performing stock on the ISEQ, losing 6.37pc to close at 25c. In contrast, Irish Life & Permanent was the top performing stock of the day, adding 6.43pc to close at 15c.
Those losses ensured the index would close in the red yesterday, but a 1.42pc loss by CRH compounded the index's troubles. The construction giant slumped 1.42pc to €15.97. Republican politicians in the United States plan to dramatically reduce funding for highway projects in the country, a key market for CRH.
Pharmaceuticals also struggled, with Elan sliding 2.43pc after it was cut to "neutral" from "buy" at UBS.
On the other side of the index, food stocks had a strong day, with Kerry Group (up 1.73pc), Glanbia (up 0.23pc) and Greencore (up 2.13pc) all ending the session on the up.
Elsewhere, European stocks fell the most in four weeks as Tokyo Electric Power said its earthquake-hit nuclear power plant may release more radiation than Chernobyl and Alcoa posted sales that missed analysts' estimates.
National benchmark indexes fell in all of the western European markets, except Greece. The UK's FTSE 100 Index and France's CAC 40 Index lost 1.5pc, while Germany's DAX Index fell 1.4pc. The Stoxx Europe 600 Index fell 1.7pc.
"What we've learnt this morning makes the situation more fragile" in Japan, said Yves Maillot, head of investments at Robeco Gestions in Paris. "The market has underestimated the catastrophe on a macroeconomic level."
First-quarter revenue for Alcoa, the largest US aluminium producer, missed the average estimate of analysts, sending a measure of basic-resource shares in the Stoxx 600 down.
BHP declined 3.3pc and Rio Tinto slipped 2.8pc. Kazakhmys, Kazakhstan's biggest copper producer, tumbled 5pc.