AIB stands out in subdued session
THE Dublin market ran out of steam last night as the euphoria of the first day's trade for 2010 dissipated in the face of Exchequer return figures showing the grim financial position facing the country and businesses.
Only bank shares seemed to be in demand as buyers forced AIB up a further 11.6pc to €1.50. Bank of Ireland, after bouncing more than 9pc in early trade, finished the session with a gain of just 0.53pc.
The rest of the market had a subdued look to it, with CRH falling almost 4pc to €18.75 after it issued a trading update which showed it expects full-year earnings to come in close to €1.8bn, in line with forecasts but down almost one-third from 2008.
In London, the new year rally continued on the FTSE 100 Index despite hefty falls for retailers amid concerns over the year ahead.
London's Footsie gained another 22.2 points to 5,523, building on Monday's 1.6pc surge that took it to levels not seen for 16 months.
A flurry of upgrades for financial firms offset woes in the retail sector after stronger-than-expected Christmas sales figures from Next and rival John Lewis were overshadowed by cautious comments on 2010 trading.
But there was a more subdued start to trading on Wall Street after reports on factory orders and housing gave mixed signals about the US economy.
In currency news, the pound was down marginally against most major currencies as sterling was knocked by talk of a pull-back in demand for gilts once the Bank of England's quantitative easing programme ends.
Next was among the Footsie's heaviest hit retail stocks even though it hiked profit forecasts following like-for-like sales growth of 3.2pc in the 22 weeks to December 24.
The recent trading boost was more than offset by its comments that it expected a tough 2010 as efforts to address Britain's public finances threatened a consumer recovery.
Next shares fell 39p to 2,100p, while Marks & Spencer dropped 7.5p to 404.9p ahead of its trading update today.
Supermarkets suffered in advance of Sainsbury's figures due tomorrow. Sainsbury's shares fell 4.3p to 319.9p and Tesco dropped 7.95p to 420.45p.
In the second tier, retailers were also under pressure, with Currys owner DSG International down 0.9p to 36.99p and HMV 1.3p cheaper at 95.1p.
Back in the top flight, Royal Bank of Scotland rose more than 10pc, or 3.3p, to 35.4p as the part-nationalised bank surged for a second successive session.
Sentiment has been boosted by positive broker comments, particularly from Exane BNP Paribas after it said better economic conditions should attract investors on a fundamental rather than speculative basis.