Irish shares failed to join in the global rally that greeted the news that Brazil had decided to allow its battered currency, the real, float on the foreign exchange markets.

The announcement that the Brazilian central bank would not spend its reserves trying to defend the real satisfied markets and allowed stock markets in Britain, France and Germany to turn substantial early losses into solid gains.

Even Italy and Spain, the two European markets hit hardest by economic troubles in their Latin American trading partners, also rose in late afternoon.

Dealers said the decision to float should hopefully relieve pressure on other Latin American economies to devalue and allow business to get back to normal. However, despite the more optimistic mood in world stock markets, trading in Dublin remained subdued as the ISEQ index of shares ended 23 points lower, uninspired by gains of more than 2 per cent in London and a 1.6 per cent rise on Wall Street in the afternoon.

But this came as little surprise to traders used to Dublin's tardy response to global developments.

"If you are global fund manager and there is a significant change in perception regarding the market, you get money into the liquid markets first. There is nothing unusual about the fact Ireland has not reacted," one dealer said. However, traders believe the benefits of the turnaround should be felt in Ireland in coming days, provided there are no further adverse developments overseas.

The leading stocks had a mixed day as AIB gained 19 cents to #16.40 (£12.92), Bank of Ireland dropped 10 cents to #18.45 (£14.53) while CRH slipped by three cents to #13.92 (£10.96). Smurfit, the Irish stock with most exposure to Latin America, lost nine cents to #1.61 (£1.27).