Debt fears and weaker CRH help Iseq shed almost 1%

DUBLIN REPORT: Iseq:2,782.64 (–24.47) Settlement date:September 10th

CRH’S FAILURE to add to Monday’s gains and fears over the Republic’s sovereign debt hit the Dublin market yesterday, knocking 0.87 per cent off the Iseq index of Irish shares, which closed at 2,782.64.

News that the Irish bond spread over German paper hit 6 per cent at one stage, surrounded by growing uncertainty about the final cost of saving Anglo Irish Bank and the State’s ability to cope, sparked another sale of Irish bank shares.

Strong performances by Grafton and exploration group Tullow helped to prop up the index, while the financial stocks and building materials group CRH all fell.

CRH shed 1.57 per cent to close at €13.45 last night.

The company’s price rose on Monday to €13.67 on the back of the announcement that US president Barack Obama intends spending $50 billion on boosting infrastructure in a bid to kick-start job-creation.

CRH draws about half its revenues from the US, but dealers said that investors in that country, who were off on Monday, failed to come for the Irish company even though they bought the shares of some of its rivals.

The banks all suffered as a result of the general negative feeling towards the Republic’s financial sector.

AIB shed 5.7 per cent to close at 76.1 cents, while Bank of Ireland was down 5.88 per cent at 72 cents. Irish Life & Permanent was off 5.9 per cent at €1.69.

Builders’ merchant and DIY specialist Grafton finished 1.96 per cent ahead at €2.91.

Exploration group Tullow added 2.35 per cent to close at €14.35, which was one of the better performances of the day.

Convenience foods group Greencore lost almost 2.6 per cent early on before recovering to close 0.09 per cent up at €1.13.