Nervousness on Wall Street ahead of today's non-farm payroll figures and modest early losses on the New York Stock Exchange and Nasdaq led to sharp falls on European stock markets, and the 0.9 per cent fall in the value of the Irish market is mild by comparison with that in some European markets.
A bad non-farm payroll figure today could trigger another slide in Wall Street, with fears of an interest-rate rise by the Federal Reserve being rekindled. A good figure would, however, inject some renewed confidence into the markets and bring a recovery in share prices.
Highlights were few yesterday, but one feature of the market was the presence of an overseas buyer of a basket of stocks at the lower levels, with the buying being largely based on the weightings in the Morgan Stanley Capital International index. The presence of continental investors in the Irish market is an increasingly important factor and this is likely to become increasingly important in the run-up to EMU next January.
The other highlight was IWP's agreed bid for Jeyes, a move that ha s been broadly welcomed by the market, although some felt that IWP was paying a high price for what is admittedly an ideal fit with its own household products business. A maximum of 14 million shares will be issued to Jeyes shareholders, if they all opt for IWP paper, increasing the number of shares in issue by around 20 per cent.
Dealers welcomed the earnings-enhancing nature of the acquisition and the size of the savings that IWP expects to make from the combined group. IWP was unchanged on 425p.
Among the leaders, Smurfit continued to be the focus of some overseas selling, shedding 4p to 261p. The main interest in Smurfit in the short-term will be on whether JS Corp and Stone Container will be able to agree merger terms ahead of the Stone a.g.m. next Tuesday. CRH lost 12p to £10.17 while Fitzwilton was 2p higher on 49p after results in line with expectations and ahead of the formal buyout bid from the O'Reilly/ Goulandris grouping.
Among the financials, AIB lost 15p to 975p, Bank of Ireland was almost 11 1/2p lower on £14.35, while sharp weakness in the British life assurance sector saw Irish Life fall 17p to 643p and Norwich Union 27p to 500p. Anglo Irish, however, remained firm, gaining a penny to 205p after its good results.
The end of the strike has finally benefited Arcon, which jumped 3p to 33p, while there was good bid interest in Avonmore Waterford which was 6p higher on 332p. Fyffes remained firm and well-bid on 210p while Kingspan traded in some size around 330p, up 2p on the day, as the markets wait to see if the group plans another move for Metsec after being spurned by the Metsec management.
Esat continued its active and volatile trade on Nasdaq and was down over $2 1/2 on $34 3/4 as the Irish market closed. Iona was one of the few Irish stocks on Nasdaq to go against the downward trend, and was $1/2 higher on $32 1/8 at the Irish close.
