The Iseq Index of Irish shares found itself firmly in the black as it surged more than 2 per cent to 4,446.32 after another volatile day of shares fluctuating wildly.
Early morning gains were wiped out by lunchtime as weakness in UK banking and building stocks spilled over into the Dublin market.
However, in line with many other European markets, the Iseq rallied strongly in the afternoon. The catalyst for the turnaround was better than expected results and an increased dividend from US regional bank Wells Fargo. This led to a rally in global banking stocks and Irish banks, which had been under pressure in the morning, were no exception.
All four banking stocks reversed morning losses. Irish Life & Permanent which had been down 10 per cent at one stage, rallied strongly and ended the day 5.65 per cent stronger as it added on 23 cents to €4.30.
Bank of Ireland, which had seen 3 per cent knocked the value of its shares in the morning, surged more than 8 per cent in the afternoon as it closed 37 cents stronger at €4.89.
Anglo Irish Bank was up more than 7 per cent, tacking on 29 cents to €4.37, while AIB advanced a more modest 2.54 per cent with its share price 18 cents stronger at €7.28.
Declining oil prices also spurred European markets. Oil fell back more than $4 a barrel after a US government report showed an unexpected increase in inventories.
This benefitted the Irish market as a whole, but Ryanair in particular. The low fares airline saw its share price surge by more than 6 per cent to €2.93.
Among the fallers on the day was construction giant CRH. Its shares traded as low as €14.05 at one stage, but closed the day at €14.65, a 24 cent drop on yesterday. Other construction stocks fared better with Kingspan tacking on 10 cents to €5.60 and Grafton 7 cents stronger at €2.74.
European stocks rose, rebounding from a three-year low. National benchmark indexes increased in 12 of the 18 western European markets. The UK’s FTSE 100 retreated 0.4 per cent. France’s CAC 40 climbed 1.1 per cent, and Germany’s DAX rose 1.2 per cent.