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ISEQ closes the week lower

Friday, February 15 17:40:05

The ISEQ closed the week lower after poor eurozone GDP figures and as it emerged that the ECB is taking a second look at Ireland's 2prom deal".

The index was down 17.07 points to 3,663.57.

Poor euro-area GDP numbers hit market sentiment yesterday. Euro-area GDP fell by 0.6pc in Q4 2012, broadly based across core and peripheral economies. In contrast, falling US initial jobless claims protected US stock prices, up marginally at the close. Monday's Irish CPI inflation numbers for January may show that the headline rate remains muted, following the fall to 1.2pc in December, Davy said. "However, the underlying trend is that domestically generated inflationary pressures in the Irish economy are emerging - a positive sign of stabilising demand, but also of bottlenecks in the economy."

Meanwhile, the ECB is re-examining Ireland's "prom deal" after ECB member Jens Weidmann today said that he was "very concerned" the deal to liquidate IBRC and spin out the Anglo promissory notes might contravene EU law. Speaking in Frankfurt today he said he believes it is important that we draw a clear line between monetary and fiscal issues. "The transaction in Ireland demonstrates how difficult it is for monetary policy to free itself from the embrace of fiscal policy once you're engaged. The Irish government in its very own statements underscored the fiscal elements in this transaction. I'm rather strict when it comes to the definition of monetary financing. It's important to draw a clear dividing line and accept the limitations of Article 123 for our actions. It's not difficult from that to guess what my position is," he said.

Shares in Glanbia rose 8c to E8.23. GNC, a key route to market for Glanbia's sports nutritional portfolio, delivered a solid finish to FY 2012 with Q4 domestic same-store sales increasing by 7.1pc. Glanbia's burgeoning nutritional business has many of the same goals in terms of product development and expansion. GNC's Q4 statement, coupled with NBTY's recent update, further endorses category strength and the opportunities in a growing international marketplace.

Davy noted this morning that relations between INM and APN have deteriorated recently and the consequent tensions will be unwelcome to both parties. For APN, disagreements with directors and significant shareholders are a distraction and tend not to help the share price performance. If APN were to seek to raise capital, INM making its pro-rata contribution would likely go against its current strategy of restructuring. This would obviously be subject to the size of the potential capital raise, the broker said. Shares in INM were down 1c at E0.03.