Business Irish

Monday 19 March 2018

Banks suffer after Fitch warning

Colm Kelpie

Colm Kelpie

IRISH shares were little changed yesterday after a mixed day, with a similar pattern across European stocks.

By the close in Dublin, the ISEQ Overall Index was down just 2.31 points at 3984.15.

The market had a mixed morning but largely fell throughout the remainder of the day.

It was a bad day for the banks after a report from global ratings agency Fitch warned that significant risks remain in the Irish banking sector.

Bank of Ireland closed at €0.17, while AIB lost 1.4pc to finish at €0.07 and Permanent TSB slipped 6pc to €0.03.

Fitch also warned that that the country's two pillar banks, AIB and Bank of Ireland, may need to raise further capital in the future, while Goldman Sachs added to the gloom when it downgraded Bank of Ireland.

Shipping and transport group Irish Continental was down 0.9pc to €22.30, while speciality baker Aryzta fell 1.6pc to €42.98.

On the other side of the board, drug company Elan was up 1.6pc to €10.13 as the board rejected the latest revised bid put forward by US pharmaceutical company Royalty Pharma.

The airlines had a good day with Ryanair up 0.32pc to €6.82 and rival Aer Lingus up 0.3pc to €1.65.

Elsewhere, European stocks were little changed after fluctuating between gains and losses more than a dozen times as Japan's economy expanded more than initially estimated while growth in Chinese exports slumped.

The Stoxx Europe 600 Index slipped less than 0.1pc to 295.22 at the close of trading.

National benchmark indexes fell in 12 of the 18 western European markets open yesterday.

The UK's FTSE 100 and France's CAC 40 each slipped 0.2pc, while Germany's DAX gained 0.6pc.

"After a strong session we see consolidation with volumes below average," said Soeren Steinert, associate director for equities trading at Quoniam Asset Management in Frankfurt.

"There is no company news that could influence individual stock prices and it seems that there is little interest in the extremely strong Japanese session and the macroeconomic figures from the country."

Balfour Beatty jumped 4.8pc after naming a new chief for its UK construction business and winning a contract.

Severn Trent, the UK's second-largest publicly traded water company, retreated the most in almost a year after rejecting a takeover offer.

Anglo American and Rio Tinto Group led mining companies lower as copper slid for a third day in London trading.

US stocks edged higher in a volatile session after Standard & Poor's raised its credit outlook for the United States, but uncertainty about when or if the Federal Reserve might reduce its stimulus efforts limited gains.

Irish Independent

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