Bank stocks rise but Iseq remains flat

Bank stocks continued to rise this afternoon, mirroring a Europe-wide rally in financial stocks.

By 12.57pm, the Iseq was down 0.86 points to 3,109.99.

Following on from yesterday's rise to €1.49, AIB continued to climb, rising 4 per cent by 12.50pm to trade at €1.55. Morgan Stanley initiated coverage with an "overweight" rating.

Bank of Ireland also gained, rising 3.2 per cent to €1.54. The European Central Bank opted yesterday to keep interest rates at a record low of 1 per cent.

After attracting some interest during yesterday's session Irish Life and Permanent rose slightly to €3.91, just over 0.2 per cent.

Shares in C&C were up 1.6 per cent to €2.85 as it issued an interim management statement that showed conditions in the cider market were still "challenging". However, there was some positives taken from the news that the company was on target to deliver profit in line with guidance.

Shares in Aer Lingus were up 4.3 per cent to 72 cent today in the wake of the announcement that pilots had voted in favour of a proposals to reduce costs by €30 million. Under the plan, 76 jobs will be cut and a 10 per cent pay cut will be implemented. However, there are still some issues to be finalised, concerning pensions, outsourcing and increments.

Elsewhere on the market, Kingspan extended yesterday's losses, falling 3.7 per cent to €6.50. Smurfit Kappa was also down, falling 1.9 per cent to €6.63.

European shares rose in early trade today, extending a winning run to three sessions, after results at US chipmaker Intel boosted hopes of a strong earnings season.

At 9.32am, the FTSEurofirst 300 index of top European shares was up 0.6 per cent at 1,069.53 points, near a 15-month high.

Yesterday the index rose 0.7 per cent and it is up more than 65 per cent from its lifetime low of March 9th, as several major economies have emerged from recession, and corporate profitability has improved.

Banks added most to the index on Friday. HSBC, Banco Santander, Credit Agricole, Lloyds and Deutsche Bank rose between 0.7 and 1.7 per cent.

Additional reporting - Reuters