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ISEQ falls below the 3,300 level again

Wednesday, September 26 12:54:09

The ISEQ slipped under the 3,300 level again this morning after three days of losses as some European ministers poured cold water over Ireland chances of securing a bank debt deal through the ESM mechanism.

By 12:45, the index was down 35.03 points to 3,275.77.

A statement by the Dutch, Finnish and German finance ministers appears to cast doubt on the June 29th agreement of EU finance ministers. One interpretation is that the statement rules out ESM funding to recapitalise banks entirely, indicating that legacy assets should remain under the responsibility of national authorities. However, it seems unlikely that the EU leaders' June 29th summit agreement to use the ESM to provide funding to recapitalise banks will be reversed. But last night's statement suggests that the terms of ESM funding should be similar to the current conditions for EFSF funding to recapitalise Spain's banks.

Goodbody, meanwhile, cut its growth forecast for Ireland, citing the still fragile nature of the "economic recovery".

Shares in Irish drugs developer, Elan, fell 7c to E8.56. Elan has announced that a new $600m senior note offering will be issued at par and is expected to close on October 1st. The coupon is 6.25pc, a considerable improvement on the terms associated with the existing notes. These notes are due 2019. Proceeds will be used to purchase, under tender offer, the existing 8.75pc senior notes, due 2016.