Irish banks tumble on signs of slowing house price growth

Investors held back from the market on Friday as fears over the impact of political developments such as Italian spending plans and Brexit hit home.

DUBLIN

Shares in Irish banks tumbled as investors ditched them following signs of a slowdown in house price growth. Bank of Ireland fared worst, plunging 4.42 per cent to €6.595 as shareholders offloaded 2.75 million of the lender's equities. AIB slid 3.08 per cent to €4.41 as investors jettisoned 23.26 million of its stock.

Traders partly attributed the slump in the pair's stock to a report from property website MyHome.ie, which is owned by The Irish Times. The figures showed house price inflation slowing with values actually falling in Dublin in the third quarter of the year. Irish banks are vulnerable to property prices as home lending accounts for a large part of their businesses.

The news also hit housebuilder Cairn Homes, whose shares fell 6.17 per cent to €1.46, and its rival Glenveagh, which dropped 3.96 per cent to 97 cent.

An Post mortgage news hits AIB and Bank of Ireland

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Sterling bounces back on Brexit hopes but investors wary

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European shares rise after shaking off Italian fears

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Pound sinks after British PM warns Brexit talks at impasse

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The market's real-estate trusts also suffered, with Green Reit falling 1.05 per cent to €1.51 and Hibernia Reit down 1.39 per cent at €1.42.

Elsewhere, agri-services group Origin Enterprises shed 2.74 per cent to €5.67. Traders blamed the banks and poor sentiment for a tough day on Friday. "Brexit isn't helping either," said one.

LONDON

Irish convenience foods specialist Greencore was down 1.93 per cent at 185.1 pence sterling with traders blaming general sentiment and Brexit concerns.

Another Irish business, distributor DCC, which raised cash from investors this week, dipped 0.5 per cent to 6,965. However, brokers pointed out that the performance was good in light of the fact that the company issued its new shares at 6,800.

Airline EasyJet released a trading statement saying it expected to benefit from Ryanair's industrial relations troubles but expected revenues to dip in the opening months of 2019. The airline's shares fell by close to 4 per cent to 1,286p at one stage before rallying to end the day 0.87 per cent off at 1,314p.

In the same industry, Aer Lingus parent IAG was down 0.7 per cent at 660.2p.

GVC, owner of bookies Ladbrokes Coral, shed 2.8 per cent to close at 918.5 on a day when investors decided to wager their cash on industries other than betting.

RSA was the worst performer on the FTSE 100, down 59p at 575p. The insurer said its UK and London business made an underwriting loss of £70 million in the third quarter as it was stung by higher weather, large losses and attritional claims, particularly in its marine division.

HSBC shares were down 12.2p at 669.8p and Barclays fell 4.9p to 171.78p after being hit by digital banking issues.

Unilever was down 16p at 4,216p as it faced further opposition to plans that will scrap its dual headquarters, and choose Rotterdam over London as its sole head office.

EUROPE

Italian banks including Unicredit, Banco BPM and Intesa Sanpaolo all fell more than 7 per cent on news that the country's government intends to boost spending and had set a deficit target of 2.4 per cent.

Shares in Dutch semiconductor maker ASM International surged after news agency Bloomberg reported that German player TCL was weighing a bid for the company.

ASM International rose 3.1 per cent to €44.75 at 5.12pm in Amsterdam on Friday after earlier jumping as much as 6.2 per cent, the biggest intraday gain since June.

US

Shares in electric car maker Tesla plunged following news that the Securities and Exchange Commission, the US stock market regulator, is suing chief executive Elon Musk for fraud over tweets saying he would take the company private for $420 a share. Tesla stock was down 14.25 per cent at $263.71 shortly after 8pm Irish time.

Shares of Facebook slumped 3.3 per cent after the company said it discovered a security issue affecting about 50 million accounts. The stock was the biggest drag on the benchmark S&P 500 and led to a 0.55 per cent drop in the revamped communication services sector. – Additional reporting: Reuters