Debt concerns drag ISEQ down
Published 25/06/2010 | 05:00
IRISH shares fell below the 3,000 mark as stocks everywhere in Europe retreated amid renewed concern that the sovereign-debt crisis may derail the continent's economic recovery.
National benchmark indexes declined in all of the 18 western European markets, with the ISEQ sliding 24.82 points, or 0.8pc, to 2977.24.
The biggest fallers included Bank of Ireland, which slipped 3.6pc to 72c, Allied Irish Banks, which slid 2.7pc to 80c, and CRH, which also closed down 1.5pc at €18.09, as investors fretted about the prospects for growth in Europe and the construction sector in the US.
Aminex rose 20pc to finish at 18c after UK-based Solo Oil said it intended to exercise an option to take up a stake in an Aminex subsidiary in Tanzania.
Another strong performer was Aer Lingus which rose 2.7pc to 80c after Goodbody Stockbrokers raised its price target to €1.25 from €1.05. Analyst Eamon Hughes praised what he called a "pincer movement on costs and improving revenue trends" which have narrowed operating losses from €81m last year to an estimated loss of €33m this year.
Dana Petroleum plunged 8.1pc in London, the biggest intraday drop since November 2008, after the oil and gas explorer said two wells would not produce hydrocarbons.
Elsewhere in Europe, shares were also down as investors fretted about the possibility of some governments defaulting on their bonds. The benchmark Stoxx Europe 600 Index slid 1.9pc as gauges in Greece, Spain and Portugal fell at least 2.5pc.
The Stoxx 600 has declined 8.2pc from this year's high on April 15, despite the European Union last month unveiling a €750bn loan package aimed at stopping the euro region's weakest members from defaulting.
"We are concerned about Europe," said Jane Coffey at Royal London Asset Management. "They have addressed the problems but the key is in the execution."
The International Monetary Fund warned yesterday that growth may be weaker than projections and added that there was also the risk that 'consolidation fatigue' could set in.
Rio Tinto, the world's third-largest mining company, closed down following signals that the new Australian prime minister, Julia Gillard, will avoid any immediate shift in fiscal policy. The government is threatening to hike taxes on mining companies.
Adidas fell 3.9pc as Kepler Capital Markets lowered its recommendation for the shares to "reduce" from "hold". Rival Nike, dropped 3.9pc in US trading after reporting fourth-quarter earnings late on Wednesday.
Micro Focus International tumbled 13pc, the biggest decline in the Stoxx 600. The UK business software maker said chief financial officer Nick Bray had left the company and was in talks with a competitor.