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ISEQ rises despite stalled economy

Thursday, September 20 12:52:12

The ISEQ rose again today despite latest GDP figures showing Ireland's economy stalled in the second quarter as investors looked to Spain and its improving debt situation.

By 12:30, the ISEQ was up 25.08 points to 3,306.66.

There was no growth in the Irish economy as measured by GDP in the second quarter of this year compared to the first while GDP fell 1.1pc on an annual basis, latest figures from the CSO showed today. Surprisingly, GNP, which is a better gauge of the domestic economy, registered a 4.3 per cent increase compared to the first quarter and a rise of 2.9pc on an annual basis - though consumer spending remained in the Doldrums, the figures show.

European shares fell in thin trade as disappointing Chinese manufacturing data weighed on cyclical stocks and euro zone banks continued to retreat on uncertainty about if and when Spain would apply for a bailout. Basic resources shares dropped 1.7 percent as data showed manufacturing activity in China, the world's largest consumer of metals, continued to contract this month. "What we haven't seen is any acceleration, which we had hoped for by now," said Dan Morris, global market strategist at JP Morgan Asset Management.

CRH's shares rose 9c to E15.36. In the US, glass maker, Apogee reported Q2 (quarter ended August) EPS of $0.18, well ahead of the consensus forecast of $0.10. Overall revenues rose by 6pc year-on-year (yoy) to $175.9m while the group posted operating income of $7.6m versus a loss of $2.7m in the same quarter last year. The architectural products segment (most relevant to CRH) saw Q2 revenues increase by 5pc to $156.4m as a result of market share gains in its installation and store-front businesses. "The results read positively for CRH's US glass business, which competes in similar end-markets," said Davy analyst, Robert Gardiner.

Irish-Swiss bakers, Aryzta, reports full year results on Monday with analysts predicting in-line numbers. Shares in the group rose 22c to E39.97.