It was another dismal day on the Dublin market today as a sell-off in banking stocks saw the Iseq index of Irish share plunge by 2.58 per cent, down 134 points to 5075.
At one stage the market had dipped below the psychologically important 5,000 mark before staging a minor recovery from early morning lows.
A hangover from yesterday’s negative outlook from rating agency S&P and weak economic data, combined with continuing concerns about further writedowns in the international banking sector led to financial stocks in Dublin taking a hammering.
Although they came off their lows in morning trading, banks closed the day firmly in the red. Irish Life & Permanent was again the hardest hit, trading down 15 per cent at one stage during the day before eventually closing the day 5.8 per cent weaker at €6.225. AIB dropped 3 per cent to €9.50, while Bank of Ireland saw 2.23 per cent knocked off its share price to €5.40. Anglo Irish Bank shed 13 cents, a fall of more than 2 per cent, to €5.82.
Construction heavyweight CRH was also under pressure throughout the day, with investors nervous ahead of its interim trading statement tomorrow particularly after Credit Suisse cut its price target on the stock and advised investors to avoid European building materials stocks for the next 12 months. The company saw 7.4 per cent knocked off the value of its share price as it shed €1.39 to €17.31.
Among the few positives on the day were Dragon Oil and Elan. Dragon surged more than 5 per cent as it added on 29 cents to €6, while Elan advanced 25 cents to €22.35.
Elsewhere, European stocks fell, extending the Dow Jones Stoxx 600 Index's worst first-half performance since at least 1987, as higher oil prices and reports on housing and manufacturing suggested the global economy will slow.
National benchmark indexes fell in all of the 18 western European markets. The UK’s FTSE 100 sank 2.6 percent, and France’s CAC 40 lost 2.1 percent. Germany’s DAX slid 1.6 percent.