Friday 25 May 2018

ISEQ drops despite positive start

Getty Images
Getty Images
Peter Flanagan

Peter Flanagan

IRISH shares fell yesterday as minor losses among some of the larger companies on the index pushed the market lower.

By the close of trading the ISEQ Overall Index had dropped 0.95pc, or 27.89 points, to finish yesterday at 2,919.30.

The index started well, and climbed as high as 2,976 at one point, but an afternoon sell-off pushed the market down steeply after lunchtime and it closed at its intraday low.

CRH, Ryanair, Aryzta and Kerry Group all posted small losses during the day but they combined to drive down the market overall.

CRH fell 0.53pc to €14.96 after the construction giant was downgraded to "neutral" by Davy Stockbrokers.

"The European building materials sector had a tough year in 2011 driven by disappointing earnings. There is a feeling of hope that last year was the trough (but) we struggle to get overly excited," said analyst Tim Cahill, who described CRH as a "quality company but expensive after a recent rally".

Aryzta fell again after Wednesday's share issue to close at €35.10 for a loss of 0.28pc while Kerry dropped 0.49pc to €28.50.

Ryanair slid 2.74pc to €3.80. The airline said it was introducing a 25c charge for every passenger from Tuesday to cover an EU tax.

Among the winners yesterday, Providence Resources surged 6.46pc to €2.80 after securing an additional licence to search for oil from the UK government while Kingspan jumped 2.66pc to reach €6.75.

Elsewhere, European stocks declined after reports showed US retail sales and initial jobless claims outweighed lower borrowing costs at Spanish and Italian debt auctions.

National benchmark indices rose in 13 of Europe's 18 western markets. France's CAC 40 Index slipped 0.2pc and the UK's FTSE 100 Index fell 0.2pc, while Germany's DAX Index climbed 0.4pc. The Stoxx Europe 600 Index fell 0.2pc.

"The bond auction was very good news," said Bernard Delattre, president of Altimeo Asset Management in Paris. "It's a sign of stabilisation to see short-term interest rates decline in Italy."

Spain auctioned nearly €10bn of bonds maturing in 2015 and 2016, twice the maximum target for the sale and at a lower yield.

Italy sold €12bn of Treasury bills, meeting its target, and its borrowing costs plunged.

Tesco tumbled 16pc, the largest decline since 1988. The company said sales declined in the six weeks to January 7. A gauge of retail shares in the Stoxx 600 slid 5.7pc -- the biggest drop since October 2008.

RBS advanced 5.6pc as Britain's biggest government-owned lender said it will cut 3,500 jobs at its investment bank over the next three years.

Irish Independent

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