Aer Lingus, Ryanair hit turbulence as Iseq dips

Iseq:2,900.78 (–6.89) Settlement date:February 29th

MARKETS REMAINED jittery yesterday as unrest in Libya sent oil prices higher, and the Iseq retreated towards the 2,900 mark.

“Macro events are taking over again,” one Dublin broker said, noting that most markets started nervously and volumes remained thin.

On the Irish market, Aer Lingus proved the most newsworthy stock with the announcement that it had made an exceptional provision of €32.5 million following negotiations with Revenue. The provisional settlement relates to redundancy payments made to staff in 2009. The stock was knocked by this news – it had been trading at 98 cents but fell back to 92 cents.

However, a trader noted that this provision represented just 9 per cent of the airline’s net cash. He said the market tended not to pay much attention to “one-off” setbacks like this.

“It takes account of it and moves on. It’s not a structural problem,” he said.

Rival airline Ryanair was weaker due to rising oil prices. The carrier closed 2 per cent lower, or seven cents, at just under €3.36.

Elsewhere, banks had a volatile session. After a slump on Wednesday, AIB executed a volte-face, jumping more than 6 per cent. However, this translated to a gain of just six cents, as the stock is trading at such low levels.

Bank of Ireland finished the day in positive territory, up 3.6 per cent, or about one cent, at 34.4 cents.

Index stalwart CRH slipped 11 cents to €16.00.

The rest of the market was “patchy enough”, one broker said, with volumes light due to the mid-term lull. Also many stocks are marking time until the Irish corporate reporting season gets into full swing next week.

The Iseq index closed down 0.24 per cent at 2,900.78.