Continuing falls on Asian markets have put a halt to the recent bull run in Dublin. Nervousness in Dublin may continue until the international markets are convinced by forecasts of recovery in the troubled region. The Asian slump is giving some Irish investors the chance to take profit from the recent surge in Irish stocks.
The lack of shares on offer has lifted some stock prices, but with London increasingly feeling the international pressures, Dublin is likely to lose at least some of its recent momentum.
Another factor being taken seriously going into next week are the troubles of US President, Mr Clinton.
The uncertainty of his position has been dragging Wall Street down since Thursday and this may feed through to London and then Dublin, say analysts. "Next week looks very clouded," one dealer said yesterday.
This week's trend of substantial gains by second-liners is likely to continue as analysts say there is a lot of pent up buying pressure in stocks like Kingspan, Arnotts and Clondalkin. Another reason is that they are more insulated from the ructions in Asia, than some of the larger stocks.
Overall, the market was deflated this week by figures from the American subsidiaries of Smurfit and Allied Irish Banks.
The worst news came for Jefferson Smurfit's subsidiary JS Corporation whose fall in profits from $117 million (£83 million) to $1 million has led to a to sharp fall in the Dublin share price. This has been repeated in New York. The company's statement on current year trading was optimistic but the share dip seemed to indicate that Wall Street, in particular, did not agree.
The word there is that Asian turbulence is likely to hit the American economy leading to significantly lower demand for packaging.
This view was reflected in a falling share price right up to yesterday evening. Dealers will be watching to see if the mooted $50 a ton rise in linerboard prices in May is sustained.
First Maryland Bankcorp (FMB), AIB's subsidiary, announced strong profits for 1997 with a 14 per cent rise in pre-tax profits to $235.5 million. Profits were boosted by the inclusion of Dauphin Deposit Corporation, acquired last year for $840 million, as well as good increases in fees from funds management and investment advisory services at FMB.
Analysts seemed split over whether the results were ahead of forecasts or just about in line. There was some negative reaction to the sharp rise in provisions for losses on credit card loans, which were up from $500,000 to $5.4 million.
Reflecting the split views, the share price rose 7p to end at 735p on the day the figures were announced.
The next few weeks will see considerable change at Anglo Irish Bank where chairman, Mr Gerry Murphy, is about to retire.
Mr Murphy decided this week to sell almost £750,000 worth of Anglo Irish shares, while one of the bank's executive directors, Mr Peter Killen realised £512,000 when he sold 259,412 shares.
Despite such selling the bank's share price stayed solid.
