Friday 23 February 2018

Irish shares leap to four-year high

Peter Flanagan

Peter Flanagan

IRISH shares rose once again to hit a fresh four-year high, despite increasing worries about the situation in Cyprus.

By the close in Dublin the ISEQ Overall Index had risen 0.78pc, or 30.57 points, to reach 3,936.6.

That was its highest level since October 2008. The benchmark has repeatedly hit new highs in recent weeks, buoyed by the country's deal on the promissory notes and the wider rally in European stocks.

Ryanair was the big winner yesterday, surging 4.83pc to €6.08 – its highest ever close. The no-frills airline confirmed it would buy 175 new 737 jets from Boeing in a deal worth $15.6bn (€12bn).

The agreement, which was first reported by the Irish Independent, is seen as a good price for Ryanair, and chief executive Michael O'Leary has indicated he may look to upgrade his fleet further later this year.

Paddy Power surged to its highest point as well, eventually ending the day up 1.9pc at €67.95.

Drinks company C&C hit its highest price since the summer of 2008, adding 1.3pc to end the day at €5.17.

Few stocks made significant moves on the other side of the board. Fastnet Oil & Gas dipped 6.6pc to 30c on the day it said it had agreed a contract for a new seismic survey at one of its prospects, while agronomy business Kenmare Resources dipped 2.7pc to 36c.

The ISEQ's performance was in stark contrast to the rest of Europe. European stocks dropped for a third day as Cyrpus President Nicos Anastasiades said lawmakers will probably reject a bank-deposit levy needed to win a European Union-led bailout. Parliament shot down the bill after markets closed.

National benchmark indices declined in all of the 18 western European markets, except Ireland and Denmark. The UK's FTSE 100 dropped 0.3pc, Germany's DAX fell 0.8pc and France's CAC 40 sank 1.3pc. The Stoxx Europe 600 Index slipped 0.4pc.

"Cyprus begins to lift the veil on how Brussels works," said Michael O'Sullivan, head of portfolio strategy at Credit Suisse Private Banking in London. "One of the pillars of banking reform across Europe was depositor insurance, and that's now unfortunately off the table. For other peripheral countries, there may be more bank refinancing to come."

Rio Tinto, the world's second-biggest mining company, retreated 5.2pc, the largest drop since November 2011. Goldman Sachs downgraded its rating on the stock to conviction sell from neutral, saying it estimates earnings declines for the commodity producer after cutting iron ore price forecasts for the next three years on over-supply.

A gauge of banks in the Stoxx 600 fell 2.1pc to the lowest close since December 31. Spain's Banco Popular Espanol dropped 6pc and France's Credit Agricole retreated 5.7pc.

Irish Independent

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