Iseq slips back into negative territory

Iseq: 2,153.67 (-5.00) at 2.00 pm:The Dublin market slipped back into negative territory today after new figures showed that the country's economic situation has worsened.

According to CSO, the economy shrank by 7.5 per cent in the fourth quarter from a year earlier while the latest Permanent TSB/ESRI house price index shows that house prices feel 9.7 per cent in the 12 months to the end of December.

The gloomy figures emerging in Dublin were echoed elsewhere with new reports showing that consumer confidence in Germany and France remained low. Meanwhile, data from the US showed that not only have the number of workers on state benefits reached a record 5.56 million but that the local economy fell at an annual rate of 6.3 per cent in the October-December quarter, the steepest decline since the first quarter of 1982.

News that the European Commission has approved the State's €3.5 billion recapitalisation of Bank of Ireland failed to lift financial shares. Bank of Ireland declined 1c to €0.48 while AIB was down 3c at €0.62 and Irish and Permanent falling by 8c to €1.10.

Financial services group IFG, which today announced pre-tax profits of €12 million for 2008, saw its stock rise by 3c to €0.45.

Elswhere, CRH was trading down 3c at 16.25 and Kerry Group, which today completed its acquisition of Breeo, gained 21c to €14.21.

Across Europe, the FTSE-100 index was up 9.58 at 3909.83 while France's CAC 40 lost 0.8 per cent and Germany's DAX gained 0.2 per cent.