ISEQ slumps amid eurozone worries
IRISH shares started the week on the back foot yesterday, slumping more than one percent amid concerns about how the eurozone bailout will be funded and the failure of a top tier broker in the US.
By the close the ISEQ Overall Index had fallen 1.13pc, or 31.19 points, to close at 2,724.66.
The index dropped into negative territory early on and stayed there for the rest of the day, although a brief rally in the last hour prevented the index closing below 2,720.
Concern about how the expanded EFSF will be financed haunted the markets for much of the day, with China still undecided whether it will invest in the fund. The market was also nervous after the huge broker-dealer MF Global filed for bankruptcy in New York after losing billions of dollars in bets on European debt.
The big loss on the day came at the biggest company on the index. CRH slumped 5.25pc to €13.09 after poor economic data in the US where it earns around half of its revenue.
Ryanair was another major stock to struggle, losing 2.01pc to close at €3.42 after Societe Generale cut their recommendation on the stock to "hold" from "buy".
Elsewhere, European stocks dropped, paring their biggest monthly gain since July 2009, as some investors remain reluctant to buy equities before the euro area's leaders explain how they will fund their expanded bailout facility.
National benchmark indices declined in all 18 Western European markets. The UK's FTSE 100 Index slid 2.8pc, while France's CAC 40 Index and Germany's DAX Index both retreated 3.2pc. The benchmark Stoxx Europe 600 Index slid 2.2pc.
Kevin Gardiner, the global head of investment strategy at Barclays' wealth unit, said that when it comes to the expanded EFSF agreed last week, "there are lots of missing details and it's still frustratingly slow".
"But it's shown a commitment that's needed to provide the financial backstop for the banking system. Markets will stay volatile."
Banks were among the worst performers of the 19 industry groups on the Stoxx 600. HSBC lost 3.6pc. BNP Paribas sank 9.6pc. UniCredit slipped 5.7pc as La Stampa reported that Italy's largest bank plans to raise €6bn to €8bn.
Rio Tinto, the world's second-biggest mining company, lost 6.5pc. BHP Billiton, the world's largest, declined 6.4pc. Copper, nickel and tin prices slumped on the London Metals Exchange.
Homeserve tumbled 28pc for the biggest slump on the Stoxx 600 after the UK-based emergency repair service provider suspended all telephone sales and marketing because a review showed sales processes didn't meet standards.
TNT Express NV rallied 5pc as Europe's second-largest express-delivery service posted an unexpected third-quarter profit.