The banks recovered from their recent over-selling and dominated a short week's trading with their recovery, although by yesterday an inevitable profit-taking round took hold. Yet again, the ISEQ shot to a new high, breaking the 5400 barrier on Thursday before yesterday's more sobering trading brought it back down by 0.3 per cent from 5404.55 to 5388.3.
Overall, investors took comfort from the international scene and the confidence which greeted the BankAmerica Corp and NationsBank Corp merger and a string of other link-ups in the international financial sector.
After the long weekend, the market opened on Tuesday by consolidating the gains made by close of business last week. Bank of Ireland was largely responsible for the wave-making as the week went on, notching up a new high of £15.75, an 11 per cent increase on its opening price this week, before succumbing to a 35p slippage yesterday.
Overseas investors and a lack of sellers provided the main impetus for the new levels. Bank of Ireland's intra-day high of £15.90 on Thursday represented a 47 per cent increase in the stock price since the beginning of the year, compared to the ISEQ's 34 per cent rise in that period. AIB also traded well during the week, reaching a new high of 992p on Wednesday, and again on Thursday, pushing up to 1001p after an intra-day high of 1014p. That figure represents a 49 per cent increase since December 31st. However yesterday's deals saw it slip 19p back from those heady heights.
The banks' performance bucked the trend in Britain where the week saw the Footsie slipping, and the British banks suffering after the Financial Times questioned the valuations put on them. Jefferson Smurfit Corporation, in which the Jefferson Smurfit Group has a 46.5 per cent stake, reported pre-tax profits of $21 million for the first quarter. That saw the Smurfit share price close 16p up on the week's opening price of 216p, despite US inventory figures which showed a lower-than-expected fall in stocks of paper.
Greencore also had a good week, dealing steadily upwards from Tuesday's opening of 442p. Approval for its Pauls Malt acquisition was reflected in a sterling close yesterday of 376p (454p), well up on its pre-acquisition price of 400p 10 days ago. Marlborough continued to trade buoyantly, closing yesterday 10p up to 390p, almost double the 200p price it stood at before being suspended while the Walter Hamill acquisition went through.
An end to the Matbro saga at Powerscreen was indicated, when sources said that the report by its auditors, KPMG, on its subsidiary was set for review by independent auditors Price Waterhouse, before it is published.
In the computer industry, stocks saw a boost despite Asian worries, with CBT, Digital, Apple and Sun Microsystems all announcing buoyant results for the January-March quarter. Intel, which caused ripples in the industry with its profit warning earlier this year, had a better-than-expected results with a 7.8 per cent drop in revenue rather than a 10 per cent one, with net profits of $1.3 billion for the first three months of 1998. Seagate, however, reported net losses of almost $128.5 million.
