MARKET REPORT:"WILL THEY or won't they" speculation over whether the main banks will recapitalise led to dramatic falls in the sector yesterday.
Overall, financials declined by over 11 per cent, leading the Irish market to close down by 120.39 points, or 4.5 per cent, at 2,450.19.
Anglo Irish Bank became the second Irish bank to fall below the €1 level this week when it slid sharply to its lowest level in over a decade. It dropped 25.1 per cent, or 28 cents, to hit €0.83.
Both AIB and Bank of Ireland were placed on review for downgrade by rating agency Moody's, a move that triggered significant declines in the AIB share price. Stock in the bank gave up 17.7 per cent of its value, or 47 cents, to drop back to €2.18.
Bank of Ireland moved off Monday's 16-year low. In a day of heavy trading in the stock, it rallied strongly to end up 10 cents, or 12.2 per cent, to €0.93. Irish Life Permanent remained somewhat consistent, falling back slightly by 6 cents, or 3.8 per cent, to €1.50.
Following forecasts of earnings downgrades from the two other financial stocks on the stock market - IFG and FBD - both declined yesterday. FBD was one of the worst performers on the Irish market, slipping by €2.85, or 25.1 per cent, to hit €50, while IFG gave up 12 cents, or 14.6 per cent, to drop back to €0.70.
On a brighter note, food group Glanbia revealed in its interim management statement that it was trading in line with expectations. Even that was not enough to prevent a sell-off in the stock, which retreated 15 cents, or 6.1 per cent, to €2.24. CRH has been strong of late, but it too suffered yesterday, falling back by 88 cents, or 5 per cent, to fall below €17 at €16.76.
Kingspan revealed that finance director Dermot Mulvihill sold 200,000 shares in the building group at €3.25 on Monday. The stock closed down by 15 cents, or 4.5 per cent, at €3.13 yesterday.
