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Profit takers, Cyprus sends ISEQ lower

Thursday, March 21 13:00:27

Profit taking from the recent sustained rally together with growing unease over the crisis in Cyprus sent the ISEQ lower this morning.

By 12:45, the index was down 34.58 points to 3,937.04.

The Irish economy grew by 0.9pc during 2012 in terms of GDP - the second year in a row that the economy grew after years of recession. However, the last quarter of the year saw almost no change compared to the previous three months, latest figures from the CSO reveal. This is the second year in succession in which GDP showed an increase over the previous year following three years of declines in GDP during 2008 to 2010. GNP, which is seen as a better indicator of the domestic economy by stripping out profits by multinationals operating here, showed an increase of 3.4pc in 2012 over 2011. On a seasonally adjusted basis, constant price GDP for the fourth quarter of 2012 showed almost no change compared with the previous quarter while GNP declined by 0.8pc over the same period.

Davy expect CRH to generate a return on invested capital (ROIC) of 6pc in 2013. Raising funds at almost half of that figure provides the opportunity for CRH to generate significant economic value. The new debt issue will not only help to reduce overall interest costs over time but will also contribute to a declining WACC. With the stock trading at just 1.1 times EV/IC, this improvement in returns dynamics is not reflected in the valuation. Shares in CRH fell 32c to E17.55.