The ISEQ index of Irish shares finished up more than 1 per cent at 5,185.48 yesterday on the back of strong performances from financial stocks, which posted a 4 per cent rise on the day's trading. Analysts said there was good buying from international investors in the big two banks, both of which benefited from sector strength in European markets.

AIB added 33 cents to close at €9.18 after announcing its first-half results, which were well ahead of analysts' expectations. The bank reported a 12 per cent rise in profits to €609 million (£483 million).

Bank of Ireland surged almost 6 per cent, adding 39 cents at €7.20. Irish Life and Permanent added 12 cents at €8.10 and Anglo Irish Bank added one cent at €2.23.

Eircom moved north of its record low price, achieved earlier this week, when it added 10 cents to close at €2.70. United Drug added 40 cents at €7.40.

Firmer oil stocks on international markets did little for Providence Resources, which lost more of its recent gains by shedding 6 cents at €0.44. However, Ennex International, the zinc mining company, surged 30 per cent to €0.78 on foot of an announcement that international investment company Endeavour Capital Corporation had taken a 15.02 per cent equity stake in the firm.

The big story among the Irish technology stocks was Baltimore's results, which were ahead of analysts' expectations. As the Dublin market closed, its shares were trading up 8 per cent at almost $21.