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ISEQ breaks two-day losing streak

Wednesday, September 19 17:33:25

The ISEQ bounced back from two days of flat trading and minor losses today as investors await first moves by the ECB to buy up Spanish bonds as part of its plan to ease the euro crisis.

The ISEQ was up 13.70 points to 3,281.58.

European shares briefly traded flat today, with banks reversing course to turn negative as markets refocused on the uncertainty of whether Spain would request financial aid and trigger a European Central Bank bond-buying programme. The FTSEurofirst 300 index was up 0.1 percent at 1,113.13 after falling to a low of 1,111.60. Euro zone banks fell more than 1 percent.

At home, shares in Origin Enterprises rose 8c to E4.30 after it released 2012 results this morning. Revenues and profits increased strongly on a year-on-year (yoy) basis, coming in slightly ahead of our expectations. As a result of the strong out-turn, the board is proposing an increase in the dividend of 36pc on a yoy basis. Revenue from Agri-Services was E1,340m, an increase of 6.6pc yoy. Operating profits from Agri-Services was E69.7m, up 5.6pc yoy. The contribution from joint ventures and associates decreased by E1.7m to E13.1m. Adjusted EPS increased by 4.2pc yoy. Underlying EPS growth, excluding the dilutive impact of the acquisitions and disposals, was 11pc. Net debt at the end of the period stood at E68m, a E24m improvement. There were some exceptional items amounting to E15.5m, principally relating to the write-down in the carrying value of investment properties and its share of the Valeo rationalisation costs.

Shares in Smurfit Kappa climbed 1c to E7.60 after Davy upgraded its 2013 forecasts for the group (+10pc), DS Smith (10pc) and Mondi Group (6pc) to reflect the impact of higher containerboard and corrugated prices. Private containerboard producers confirmed that a price increase of E50/tonne for recycled containerboard prices had been successfully implemented in Continental Europe in September. OCC prices have started to increase in recent weeks and are likely to continue to rise through September and October. "We are upgrading our price target for Smurfit Kappa Group to 1200c (previously 1000c), implying over 60pc upside from current levels. Our price target for Mondi Group is now 730p (previously 660p), 20pc above current levels," said analyst, Barry Dixon.