Irish shares tumble to two-year low
IRISH shares fell to their lowest level in nearly two-and-a-half years yesterday as concerns over Greece sent stocks into a tailspin.
By the close of trading, the ISEQ Overall Index had lost 2.54pc, or 61.96 points, to close at 2,382.06. That was the ISEQ's lowest close since April 2009, when the financial crisis was at its height. The index has lost nearly one-fifth of its value since July 22.
Traders remained concerned about Greece's position, amid reports that Germany was working on a plan to shore up its banks if Greece defaults. The yield on Greek two-year debt passed 60pc for the first time.
Stocks fell across most sectors, with oil and gas stocks in particular struggling on fears of an economic slowdown.
Dragon Oil slipped 4.94pc to €5.20, while Petroneft slipped 7.84pc. Tullow Oil slid 1.98pc to €16.17 a day after it climbed nearly 20pc on the back of a discovery in French Guiana.
Food stocks were also hit badly, with Kerry Group falling 2.27pc after it announced a takeover of a German ingredients company. Glanbia fell 2.4pc to €4.68, while Greencore sank 1.55pc to 57c.
Airlines struggled, too, with Aer Lingus and Ryanair both closing off.
Few stocks posted gains during the session, but Origin Enterprises surged 6.45pc on reports of a €463m private equity bid for the company.
Elsewhere, the Greek crisis dominated the day as national benchmark indices declined in all western European markets.
The UK's FTSE 100 Index slid 1.5pc, Germany's DAX Index lost 2.2pc and France's CAC 40 Index declined 3.9pc. The MSCI World Index, a composite of the world's major exchanges, slipped into bear territory, extending its drop since this year's high to 20pc. The Stoxx Europe 600 Index fell 2.4pc.
"What dictated direction was the only too familiar concern about European debt," said London-based David Jones of IG Index. "The belief that Germany is getting ready for Greece to default has gathered steam over the weekend and found momentum today."
In Paris, banks plunged on concerns about their exposure to Greece. French lenders top the list of creditors with €41.72bn in overall exposure to the country.
Societe Generale slid 8.9pc. BNP Paribas tumbled 12pc and Credit Agricole plunged 9.7pc. All three lenders have tumbled at least 49pc in the last three months. In June, Moody's placed the three banks' ratings on review to examine "the potential for inconsistency between the impact of a possible Greek default or restructuring and current rating levels".
A gauge of insurers posted the biggest loss among the 19 industry groups in the Stoxx 600, retreating 4.5pc. AXA slumped 9.7pc and ING lost 8.6pc.