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ISEQ slips after weak US growth figures

Wednesday, January 30 17:33:59

The ISEQ slipped in to the red today in line with global markets after latest data showed a surprise fall in US economic growth in the fourth quarter.

The index was down 7.69 points to 3,548.32.

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 5c to E10.45. 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 dipped 1c to E0.38.