Iseq gains as European markets rebound from early losses

Iseq: 2,535 (+28) by 12.45pm: The Dublin market was described as "surprisingly" healthy this afternoon as European bourses rebounded from steep losses in the US and Asia overnight.

At 12.45pm the Iseq index of Irish shares was up one per cent at 2,535 a gain of 28 points.

Brokers said the significant sell-off in the US overnight may have been misread as a resurfacing of economic fears when in fact many stocks were being sold-off following the strongest 5-day period in 75 years.

Although analysts said buyers were coming into the market, volumes were relatively low.

Following the rejection of a second takeover bid last night by its board Aer Lingus shares were up 3.2 per cent at €1.32, still well below the €1.40 offer price from Ryanair that values the company at €748 million.

Brokers said the fact that the share price has been relatively static suggests there is little confidence a deal can be done at these levels.

Having fallen by between 8 and 12 per cent in early trade banking stocks had recovered by lunchtime. Anglo Irish Bank - which issues results tomorrow - was ahead 2 per cent at 86 cents while Bank of Ireland had trimmed its decline to 5 per cent at €1.35 by 12.45pm.

Irish Life and Permanent shares were 4.7 per cent lower at €1.62.