The Irish stock market shed more than 2 per cent as continued turmoil in Asian markets again cast its shadow over world stock markets yesterday.
The collapse of the once high-flying Peregrine investment group, one of Asia's largest independent investment banks, led to an overnight rout on Asian stock markets which had knock-on effects in Europe.
"We are directly reflecting the weakness internationally. There is a lot of nervousness out there. It's going to be some time before the Asian crisis is resolved," one trader said.
Irish shares closed 1.67 per cent lower as most of the larger and more liquid Irish stocks fell victim to profit-taking. But dealers said volumes were light and there was little sense of panic in Dublin.
"The Irish market has been a victim of global developments and what we've seen is really more of a markdown than a selldown," a trader said.
Dealers also noted that many of the leading stocks recovered slightly toward the close as investors, who had been waiting for weaker prices, took advantage of the opportunity to get into the market.
Irish economic fundamentals remain sound and a better-than-expected set of results from fruit importer Fyffes underlined the positive outlook for corporate earnings, traders said.
Fyffes announced an 11.5 per cent increase in pre-tax profits for the year to October 31st, 1997, while earnings per share rose by 20 per cent. The share price bucked the general market trend and rose 3p to close at 121p as brokers said they planned to upgrade their forecasts for the group.
Meanwhile, most of the major stocks ended lower but above the day's lows, helped by a recovery in the Dow which managed to claw its way back into positive territory.
AIB, which dropped as low as 697p, recovered slightly to end the day 15p lower at 710p, while Bank of Ireland fell to 1069p but finished at 1090p, a 32p fall. Other financial stocks to suffer included Irish Life, down 13p at 410p, and Irish Permanent which shed 20p to 750p.
The leading industrials also gave up some of their recent gains and CRH closed 18p lower on 840p, while Smurfit yielded 7p to end at 193p.
Activity in second-line stocks was muted but a handful resisted the downward trend.
DCC gained 2p to 482p, Heiton was also up 2p at 232p while Abbey was up 10p at 290p.
Arnotts announced that Egerton European Dollar Fund Limited now holds 3.64 per cent of the issued share capital after acquiring 649,001 shares on January 8th.
Meanwhile, GE Capital said it had dispatched notices in order to implement the compulsory acquisition of the outstanding ordinary shares in Woodchester.
