| 11.5°C Dublin

Oil and gas companies take a hit

IRISH shares fell yesterday with a poor performance from oil and gas companies and a mixed result for the country's banks.

The index continued a decline that began on Friday after several days of growth.

By late afternoon in Dublin, the ISEQ Overall Index had fallen by 0.52pc, down by 20 points to 3859.57.

The index dipped mid-morning but recovered to some degree in the afternoon.

Even with yesterday's fall, the ISEQ is up 13.63pc in the year to date and has gained 1.7pc in the last five days.

Permanent TSB was up by 2.9pc, after a 10pc fall on Friday. The lender is reportedly getting tougher with its union, threatening cuts to its pension scheme and seeking to save costs by scrapping allowances.

AIB was down by 4.3pc to 7c. The bank has said that mortgage resolution targets recently imposed by the Central Bank mean that it will have to have more challenging conversations with customers who prioritise unsecured debts ahead of their mortgages.

Basic materials providers also took a hit. Building materials supplier CRH was down 1.62pc to €16.08 per share as manufacturing data from the US showed a weakening sector. CRH garners half its revenue from North America.


Oil and gas slumped too as weaker-than-expected economic data from China hit sentiment.

Dragon Oil fell 7.24pc to €7.02 and rare earths miner Kenmare Resources was down 4.64pc to 33c. However, Petroneft Resources, which has the majority of its operations in Russia, saw a 4.65pc rise in its share price, to 50c.

It was a good day for Ryanair, up 1.15pc to €6.07. Elan shares rose by 1.01pc to €9.10, after takeover bidder Royal Pharma increased the value of its offer for the drugs company.

All in all, 12 companies were up while 14 were down and 19 remained unchanged.

The ISEQ's fall mirrored other European indices. National benchmark indices fell in all of the 18 western European markets open yesterday. The German DAX was down by 0.41pc and the FTSE 100 in London was down 0.64pc. In Paris, the CAC 40 fell 0.5pc. The composite Stoxx Europe 600 Index fell 0.7pc, as China's economy grew at a slower pace than estimated.

"The Chinese growth data is bad news, especially after the weak US jobs data we saw," said Jacques Porta at Ofi Gestion Privee in Paris.

"There is a worried atmosphere among investors because markets have already increased a lot. To see them go up again, we'll need to see very good economic data and I don't see that getting better in the next month."

Ladbrokes sank 8pc after the UK gambling company forecast 2013 operating profit at the lower end of analysts' estimates.

Irish Independent