The problems of the Far East came to haunt some of the bigger Irish industrial companies with a hefty exposure to those weakening economies this week. Smurfit, Waterford Wedgwood and In- dependent all found it difficult to hold their ground.
By contrast, the booming domestic economy continued to attract overseas investment interest in the banks, and there were solid gains all across the sector.
A sustained slowdown in the Far East and the Pacific Rim economies has obvious implications for Smurfit, Waterford Wedgwood and Independent. Far Eastern manufacturers are big consumers of linerboard, the Japanese buy lots of Waterford's Wedgwood china while Independent has very large media interests in Australia and New Zealand, all of which are very exposed to downturns in the local economies.
Even the buying in of 250,000 shares at 400p did not put a floor on the Independent share price and, with analysts tweaking some of their forecasts to reflect the uncertainty in the Far East, the Independent share has struggled to get back close to that 400p buyback price.
Corporate news was thin on the ground as the reporting season grinds to a close, but results from Jurys came in ahead of forecasts and helped the shares climb back towards the 650p level after they had slipped back towards 600p.
The excellent performances by Jurys and by Ryan should be of immense benefit to Doyle Hotels, if Doyle does go ahead with its long-expected flotation. There is a real appetite for Irish hotel stocks among both Irish and British institutions.
Allied Irish Banks may be in the running for another big expansion in Poland, having been shortlisted for the 41 per cent of BPH Bank being sold off by the Polish government. That stake is currently worth around £230 million in the market and would represent a major intensification of AIB's expansion into Polish banking, building on the success of the WBK investment. Other corporate news included the proposed £10 million acquisition in Britain by ITG and a £12 million placing and open offer.
This move by ITG will transform the company and it will be no surprise if the telecoms group upgrades its Developing Companies Market (DCM) listing to a full stock market quotation.
Another tapping the market for funds was Celtic Resources which is also using the open offer method to raise £1.8 million for its exploration ventures.
On a much bigger scale is the likely flotation of C&C after Allied Domecq bought out Guinness's 49.6 per cent stake in the Irish drinks group for £270 million. If the decision is to float C&C, there is no doubt that there will be strong interest from domestic and overseas institutions, given C&C's exceptional financial record and the glaring absence of an Irish drinks company on the Irish stock market.
Add in the Telecom privatisation in mid-1999, the flotation of First National this autumn and the expected flotation of a plethora of high-tech companies and it looks like being an extraordinarily busy year for the market.
