Speculation over the Government’s intentions with regards to the banking sector and the possibility of consolidation led to a volatile day on the Irish market, which closed down by 96.14 points, or 4.0 per cent, at 2,320.08.
There were few positives on the day, although heavy trading in Datalex saw it rise by 0.02 cent, or 10 per cent, to climb to €0.22. Blackrock added almost 1 cent, or 8.3 per cent, to rise to €0.07 while McInerney also finished the day on a high, advancing by 2 cent, or 9.5 per cent to finish up at €0.23.
Although the banks opened up by about 5-15 per cent, they fell back in the afternoon following a weak opening in the US. Irish Life & Permanent was the worst on the day, giving up 29 cent, or 19.9 per cent, to fall back to €1.15
AIB lost 10 cent, or 4.0 per cent, to close down at €2.15, having been up and down throughout the day, while both Anglo Irish Bank and Bank of Ireland (BOI) gave up their early rallies to finish the day down. Anglo lost 1 cent, or 0.5 per cent, to close down at €0.92 and BOI declined by 0.04 cent, or 3.8 per cent, at €1.01.
Food group Aryzta suffered, dropping by €1.60 or by 7.5 per cent to drop back to €19.70, while construction stock Kingspan fell below the €3 level, giving up 17 cent, or 5.6 per cent, to hit €2.90.
Although oil fell below $50 a barrel, Ryanair fell marginally, losing 3 cent, or 1.0 per cent to fall back to €2.65.
CRH tumbled again, losing 87 cent, or 5.4 per cent to close down at €15.36, while C&C group was also in negative territory, giving up 8 cent, or 6.3 per cent, to finish down at €1.18.
In Europe, stocks slumped following the sell-off in US stocks the previous evening, sending the Dow Jones Stoxx 600 Index to its lowest level since 2003.It finished the day down by 3.5 per cent at 186.98, the lowest level since April 2003.
In all of the 18 western European markets, national benchmarks declined, with the UK's FTSE 100, Germany's DAX, and France's CAC 40 each dropping by more than 3 per cent.
In the US, the S&P 500 fell to a six-year low on the back of jobless claims rising to their highest level since 1992. Banks struggled, with JP Morgan tumbling by 13 per cent and Citigroup by 18 per cent. Overall, the S&P 500 had declined by 1.3 per cent to 796.18 by 11.38 am, while the Dow Jones Industrial Average lost 64.36 points, or 0.8 per cent, to fall back to 7,932.92.
