ISEQ falls as bloodletting resumes
The bloodletting resumed on the markets yesterday, with no signs that efforts by Greece to persuade fellow EU member states and investors that it is prepared -- and able -- to take serious measures to tackle its precarious financial position are working.
The uncertainty created a day of nervousness following stronger market performances last week. There was speculation that the EU and IMF won't release a crucial €8bn chunk of aid that Greece is relying on to be able to pay its bills and prevent the country from finally tipping into the financial abyss.
The euro was also dragged lower as the spectre of a default loomed large. A proposal for a property tax in Greece aimed at raising €2bn is expected by EU and IMF officials to manage just half of that target. A crunch telephone call was scheduled for yesterday between Greece's financial minister and EU and IMF inspectors to ascertain if the country was eligible for its next payment from the rescue fund.
"Greece has sufficient cash to keep going until mid-October, but with this deadline fast approaching, it's perhaps no surprise that many will start looking at ways to take risk out of portfolios and it's no surprise that financial stocks are already feeling the squeeze," said Cameron Peacock, a market analyst at IG Markets in Melbourne.
In Ireland, the fall on the ISEQ mirrored that of other markets. The ISEQ Overall Index fell from the off, and ended the day down 40.69 points, or 1.63pc, at 2456.54.
Mining firm Kenmare Resources was down more than 11pc at one stage on wider metal price declines, but managed to claw back some losses to finish 4.7 cent, or 8.1pc lower at 53.3 cent.
With continued question marks over a massive pension deficit that the airline insists it has no responsibility for, shares in Aer Lingus fell 7.1pc to 65.5 cent. The pension issue could stall what would already be a reasonably difficult task for the Government in finding a buyer for its 25.1pc stake in the airline.
Smurfit Kappa fell over 4.9pc to €4.65, while Cavan-based insulation maker Kingspan sank 4.2pc, or 28 cent, to €6.30.
There were few bright spots, although Origin Enterprises, which releases full-year results on Thursday, rose 5pc to €3.36. There has been speculation that a bid could be made for the group.
National benchmark indices declined in every western European market. France's CAC 40 fell 3pc, the UK's FTSE 100 dropped 2pc and Germany's DAX lost 2.8pc.
Deutsche Bank and Commerzbank, Germany's largest lenders, led a gauge of European bank shares lower, falling 4.5pc to €23.96 and 4.1pc to €1.69, respectively.
France's Societe Generale, which was downgraded by Moody's last week, sank 6.7pc to €17.69. Credit Suisse declined 6.2pc to €21.31.