The Dublin market was surprisingly flat despite mountains of positive corporate news and firmer performances on international markets.
The news of Elan's huge $700 million (£500 million) acquisition of Neurex did not perk up the market as much as expected and Elan's own share price closed unchanged at 4502p. "People in Dublin took their lead from the early fall in Elan shares in New York and decided not to rush in," said one dealer.
Overall, dealers were positive about the deal which they admitted took them by surprise. "They have been making so many acquisitions in the last few months that we did not expect any more news for a while," said a dealer. Dealers said the Neurex deal is good value for Elan, although the share price might be deflated in the short term. "Like almost all the deals Elan do, we do not fully understand the details of it, but it seems to be a good fit," was the comment of one dealer.
Elsewhere there was furious trading in Smurfit shares on the back of the disclosure that JS Corp is in discussions with Stone Container on a possible merger. Despite its closing drop from 256p to 255.9p, dealers said the price probably undervalued the stock. "The story went down well on the markets, but some decided to take profit on the strength of it alone," said one dealer.
The results from the Ryan Hotel Group while received positively did not push up the stock and it closed down at 99.5p. "They were good numbers alright, but if a hotel group is not doing well now it never will be," said a dealer.
The financials saw some recovery on the day, with AIB putting on 10p to close at 965p, while Bank of Ireland was up from 1430p to 1437.5p. Irish Life was strong earlier in the day, but closed down at 660p from 667p. Irish Permanent, which announced a new initiative to expand into Northern Ireland, remained unchanged at 950p. Its joint venture with NIE could not be judged at this early stage, said dealers. The market showed little interest in Crean's 1997 results, although there was a 2p rise in the share price. "Interest in the stock has been waning for some time and we expected these losses," said a dealer.
The other main movers were Kerry, down from 1130p to 1125p, Ryanair, down from 550p to 548p and Greencore down 10p to 430p.
