Greek measures boost confidence
Published 29/06/2011 | 05:00
THE ISEQ advanced above the 2,900 level for the first time in four days in the hope the Greek parliament will approve new austerity measures, paving the way for a slow resolution to the country's problems. Shares in Irish Life & Permanent tumbled once again.
The benchmark index rose for a third day, adding 25.83 points, or 0.9pc, to 2912.05 points. Shares in Irish Life & Permanent tumbled 50pc to 3 cents after the company said yesterday that it will end up being 99pc owned by the State following its failure to raise money from investors. The company will be delisted from the exchange. Allied Irish closed down 4pc at 14c as Finance Minister Michael Noonan rubber stamped AIB's takeover of EBS.
Shares in Bank of Ireland rose 5.2pc to 12c as the lender said it will halt its offer to swap £75m (€85m) of its bonds a day before a London court was due to start hearing a legal challenge to the transaction. The lender said some owners of the securities had "procedural difficulties" in taking part in the exchange.
Stocks elsewhere in Europe also had a good day as confidence grew that Greek Prime Minister George Papandreou will push through a fresh package of austerity measures. National benchmark indices gained in all of the western European markets, except Iceland and Belgium.
In London, the FTSE 100 Index advanced 0.8pc. France's CAC 40 Index climbed 1.5pc, while Germany's DAX Index added 0.9pc. The benchmark Stoxx Europe 600 Index increased 0.5pc by the 4:30pm close in London.
Standard Chartered rose 2.7pc after the UK's third-largest bank by market value said first-half profit before taxes may post "double-digit" growth from a year earlier. Prudential climbed 2.6pc after Goldman Sachs upgraded Britain's largest insurer to "buy". TomTom plunged 27pc after cutting full-year profit and sales forecasts as US demand for its devices declined.
"Without Europe's debt crisis, the environment is positive for equities," said Thilo Mueller at MB Fund Advisory in Germany. "Equities are cheap, economic data and companies' earnings are good. If the Greek parliament votes for austerity measures, this will help ease concern in the market."
The main Greek index rose 2.7pc as Alpha Bank surged 4.3pc and National Bank of Greece, the country's largest lender, soared 5.4pc. EFG Eurobank Ergasias rallied 5.8pc.
HSBC boss Stuart Gulliver said the bank and other lenders have discussed Greece's debt payments with the Institute of International Finance. "There appears to be an emerging consensus that agreement is a week or two away," he said in London yesterday.
Adidas and Puma jumped after Nike posted fourth-quarter per share earnings above expectations.