A SHARP fall by Bank of Ireland after its results brought the Irish market back from record territory and the market closed down fractionally on the day despite a firmer tone among industrial shares.
Bank closed down 7p to 450p with indications of some significant selling by overseas investors. The view from overseas seems to be that the results from Bank's Irish operations were lower than expected.
Some overseas institutions have bought into Bank on the basis of its strong exposure to Ireland's tiger economy and apparently decided that scope for increased earnings from the Irish operations is limited.
AIB also suffered from the bearish tone towards financials but confined its loss to 1p to close on 339p. CRH was by far the best of the industrials and closed up 9p on 592p after a strong performance the previous day by the British building materials sector.
Smurfit was 1p easier on 173p on reports that the latest shipment figures from the US show higher inventories and lower shipments not good for the sector which is hoping that International Paper's $50 a ton price increase can be maintained.
The Kerry announcement that the parent co-op intends to bring its stake down from 52 per cent to 39 per cent was greeted enthusiastically and the share closed 10p higher on 610p a fraction short of £1 billion capitalisation. The prospect of much improved liquidity in what has been a notoriously liquid share boosted the share and Kerry closed well bid on 610p.
Other food stocks fared poorly, with the spectre of milk price changes hanging over the three stocks most exposed. Golden Vale was 2p lower on 65p as the market waits to see exactly what action the company takes to restore margins.
Avonmore was unchanged on 145p but the market will be looking for a milk price cut of more than the 3p a gallon already announced. Waterford Foods will decide its milk price tomorrow but the share fell 3p to 96p.
Overall, there is a view in the market that the dairy stocks are unattractive at least until the uncertainty over 1996 margins is clarified by the companies actions on milk price. The fact that Kerry and possibly Dairygold will hold the milk price at 108p a gallon for the rest of the year will undoubtedly put pressure on Avonmore, Waterford and Golden Vale as the three companies try and balance the conflicting priorities of their supplier shareholders and institutional investors.
DCC was unchanged on 248p after selling its 24.5 per cent of Heiton at a tidy profit. Heiton itself closed up 5p on the 100p DCC got for its shares.
