Market Report: The stock market closed more than 40 points higher yesterday as it resisted the weaker downward trend seen in overseas markets.

Eircom was not one of the beneficiaries of the better close, however, losing six cents, or 4.2 per cent, to €1.37, as it drifted ever further from its flotation price of €1.55.

However, an improved performance among financial stocks helped lift the ISEQ. Bank of Ireland bounced back after Monday's weak performance to close 36 cents, or 3.5 per cent, higher at €10.64.

AIB also made gains, finishing 13 cents, or 1 per cent, firmer at €12.70, while Anglo Irish Bank was up 15 cents, or 1 per cent, to €13.35.

Only Irish Life & Permanent failed to benefit from the improved sentiment in the sector, ending seven cents or 0.5 per cent lower at €13.90.

Among industrial stocks, CRH had a good day, gaining 37 cents, or 2.2 per cent, to €17.17.

Low-cost airline Ryanair added a further eight cents, or 1.6 per cent, to €5.05.

In the pharmaceutical sector, Galen shares slipped back along with their counterparts in London. The stock lost 26 cents, or 2 per cent, to €12.65 after the company's founder and former president, Dr Allen McClay, placed his 6.3 per cent stake in the company at a price of 810p sterling per share.

Elan shares lost 2 per cent, or 38 cents, in Dublin to €17.52, and they were also weaker in New York.

Among technology stocks, Iona gained a further five cents, or 0.75 per cent, to €6.70, ahead of results later this month.

Merrion Stockbrokers published a note on the company yesterday, giving it a speculative rating on the basis that the Iona recovery story still has only limited visibility.

In London, Vodafone shares lost 1 per cent after Finland's Nokia, the world's leading mobile phone maker, said earnings would be at the low end of its guidance and below market expectations.