European markets slide steeply

Stark news on the euro front sent the markets back into freefall today, wiping out a chunk of the gains that were made during what turned out to be just another bounce earlier in the week.

The Dublin market and the FTSE 100 outperformed the rest of Europe, courtesy of some good news from exploration group, Tullow Oil, but all indices were only ever heading in one direction today.

All European markets were weak this morning, following a fall around the close in the US on Thursday night. The announcement that European Central Bank board member, Juergen Stark, is leaving his post early in a row over the bank's bond-purchasing policy helped ensure that already jittery investors took fright altogether.

The Iseq dropped 3.17 per cent to close at 2,444.02, which turned out to be a better performance than many other European bourses.

Germany's Dax sank 4 per cent and France's benchmark CAC 40 was down 4.4 per cent. The Stoxx 600, which tracks leading stocks in 18 western European markets, was down 3.7 per cent for the week at 224.59.

In London, the benchmark FTSE 100 ended the day down 2.5 per cent at 5214.65.

In Dublin - and London - the clear star performer was Tullow Oil, which announced a significant oil find off the coast of French Guiana.

It closed 19.22 per cent up to end the on the Irish market at 16.50 as investors piled in. In London, where most of the shares are traded, it added over 15 per cent.

Another exploration group, Providence, also performed well in Dublin, adding over 9 per cent to close at 2.65. This was the second day in a row that Providence outperformed the market. Dealers said there was no particular reason for this, other than the fact that it looked over-sold and, as a comparatively cheap stock, any price movement was going to look exaggerated.

Dublin's biggest stock, building materials group, CRH, which has a large exposure to the US, fell over 6.9 per cent to close at 11.06 meaning it gave back most of the gains made during the week.

Traders pointed out the group's price tends to "overreact" to market movements. When the trend is up, it tends go move ahead of the market, and it tends to fall more behind when the market goes in the opposite direction.

Another loser today was Ryanair, which shed 3.77 per cent to close at 3.04, again giving up some of the gains made earlier in the week.

Also among Dublin's heavyweights, packaging group, Smurfit Kappa dropped 4.15 per cent to end the day at 4.62.