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ISEQ treads water as leads awaited

Wednesday, January 30 12:43:28

The ISEQ treaded water today, awaiting leads on the macro-economic and earnings fronts.

By 12.30, the index was down 3.99 points to 3,552.02.

European shares fell from two-year highs today, dragged lower by concerns over earnings in the tobacco and oil services sectors, including a profit warning from Italy's Saipem.

Shares in Smurfit Kappa fell 10c to E10.40. The latest FOEX data, released this morning, shows that European OCC prices have increased for the second consecutive week. OCC prices increased by E0.12/tonne to E108.26/tonne. In addition, the tone of the FOEX commentary is positive noting that purchasing activity in China has picked up and European demand has improved. "While we have the price increase almost fully incorporated in our models, successful implementation will underpin forecasts and has historically been a positive catalyst for the share prices of Smurfit Kappa and DS Smith. We reiterate our BUY recommendation on Smurfit Kappa and DS Smith," said Goodbody Stockbrokers.

Kenmare issued a Trading Update this morning the main points of which were confirmation of price weakness particularly for zircon and the high-end of the TiO2 (rutile) markets as the year drew to a close, but also additional delays towards the completion of the Phase II expansion programme. As usual, commentary on pricing is more of a subjective, rather than absolute nature, though we would point to the Iluka statement on January 17th, which outlined an average Q4 zircon price of $1,449 per tonne, compared to an FY13 spot zircon price in our model of $1,750/tonne. Its shares were flat at E0.40.