Eircom shares finally touched bottom after the recent disastrous run which has seen the share price slump through its flotation price and leave half a million small investors showing a paper loss on their investment. Eircom shares regained 7 cents to close on €3.75 (£2.95), but are still short of the €3.90 (£3.07) flotation price.

Eircom's modest upturn was assisted by a recovery in the European telecoms sector, especially in Britain where both British Telecom and Vodafone were sharply higher.

European telecom stocks were mixed, but some analysts were taking the view that the recent sell-off in the sector may be nearing an end. If that is the case, and Irish institutions return as buyers of Eircom, then the share should benefit.

Trading in Eircom shares was sizeable and in London, over 4.5 million shares traded as the stock regained 5 cents to €3.73. Eircom shares have still not recovered in New York where they were trading marginally easier at $151/4 last night, still well off the $18 flotation price.