Purely on the basis of corporate earnings, the Irish market is in excellent shape, with the strength of the domestic economy drawing investors into Irish stocks.
However, even that economic strength counts for little when Wall Street and the major international markets get nervous.
It isn't often that ringgits, bahts and other exotic currencies have an impact on stock markets on this side of the world but the extraordinary developments on Far Eastern financial markets in the past few days show that European markets cannot remain immune from major developments in the tiger economies there. That said, it has been a reasonably good week for the Irish market, with a series of excellent halfyear results from second-line stocks supporting the market and auguring well for next week's series of results from market heavyweights such as Kerry, CRH and Waterford Wedgwood, although expectations for Smurfit are lower.
The figures from Grafton, Readymix and Kingspan show the strength of the construction industry and shares in this group of companies rose strongly after the half-year results.
Likewise, Irish Continental rose strongly after the seasonal loss in the first half came in lower than market expectations. The only stock not to fully meet or exceed market expectations was Irish Permanent, but even here, the figures were only marginally lower than consensus forecasts.
Purely on the basis of corporate earnings, the Irish market is in excellent shape, with the strength of the domestic economy drawing investors into Irish stocks.
However, even that economic strength counts for little when Wall Street and the major international markets get nervous.
Greencore turned weaker later in the week after it emerged that the group's US associate, Imperial Holly, has turned predator with a $500 million (£6336 million) bid for the American sugar group, Savannah Foods. If this bid is successful, about $150 million worth of Imperial shares will be issued to Savannah shareholders, a move that would automatically dilute Greencore's stake in Imperial from 27 per cent to 16 per cent.
Most in the market believe, however, that Greencore has been deeply involved in the planning of this bid by Imperial. As a result, there is a strong belief that, if diluted to 16 per cent, Greencore would quickly move to inject fresh equity into Imperial - and possibly move to a majority position in the American company.
Given the strength of Greencore's balance sheet, even the £190 million involved in going to a majority stake in Imperial would not be overtaxing if spread out over a couple of equity issues. But such a move would eliminate any possibility of a share buyback, a possibility that has attracted some investors into Greencore over the past year.
Some believe that such a move would be good for Greencore as it would reduce the dependence on Irish sugar beet and the demands of beet growers. Others are cautious about Greencore getting heavily involved in the US sugar industry, with forecasts that increases in processing capacity and lower beet supplies will squeeze margins in the industry in 1997 and 1998.
Ryanair managed to recover a lot of ground after the dismal market reaction to the first-quarter results and what even the company admits was a disastrous conference call with US analysts. Credit Suisse First Boston (CSFB) came out with a "strong buy" tag.
