Stockmarkets sink as ISEQ hammered
Stockmarkets in Europe sank again yesterday, following Friday's sell-off, despite latest figures from Germany that showed the business climate there improved for a third month in January and beat expectations.
But the good news was more than offset by continuing qualms about emerging markets and housing data from the US that showed new-home sales there fell 7pc in December to a much lower rate than had been anticipated.
"We're still in the relatively early stages of an economic cycle," Kevin Lilley, head of European equities at Old Mutual Global Investors, which manages about $17bn (€12.4bn) in fund.
"You get periods where things get overbought and it's culminated as a few companies missed their fourth-quarter numbers and emerging markets started de-stabilising," he added.
"Investors have been withdrawing cash from emerging markets. I'll get concerned when it becomes clear the global economy is getting impacted and when it becomes clear the GDP forecasts that are rising at the moment are too high."
European Central Bank governing council member Christian Noyer insisted turmoil in emerging markets is unlikely to throw Europe's recovery off track.
In Ireland, the ISEQ Overall Index was hammered again, yielding 1.6pc, or 76.21 points to 4,640.52.
Bank of Ireland lost more ground, tumbling 4.5pc to 27.3 cent, while other financials were also hit. Insurer FBD lost 3.2pc, or 60c, to €17.90.
Two quoted real estate investment trusts – Hibernia REIT and Green REIT – both declined, shedding 3pc and 3.6pc respectively and closing at €1.09 and €1.30.
Independent News & Media fell 9.4pc to 14c.
Ryanair fell 1.1pc to €6.58, while Aer Lingus lost 2.8pc to €1.39.
In the UK, Irish firms listed there also faced headwinds yesterday. Food group Greencore, which delivers an interim management statement today to coincide with its AGM, declined 0.8pc to £2.39; while Grafton Group fell 1.4pc to £5.99.