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ISEQ out of synch with world markets

Thursday, May 29 17:37:44

The ISEQ dipped in to the red despite the fact that the world's stock markets today reached close to all-time record highs.

By the close, the index was down 15.18 points to 4,911.62.

Global equity markets hovered just off all-time highs as investors brushed off a weaker-than-expected reading on the U.S. economy, while benchmark U.S. Treasury yields fell to 11-month lows. On Wall Street, the S and P 500 hit another intraday high early in the session despite first-quarter GDP data showing the U.S. economy contracted 1 percent. Better-than-expected jobless claims pointing to a strengthening labor market and merger and acquisition activity also boosted sentiment.

At home, profit taking dominated after four days of steady gains.

Kerry's shares rose 12c to E55.50. Tate and Lyle reported full year results to the end of March this morning, with sales and profits behind consensus by 4.8pc and 1.2pc respectively. The miss was driven by a 6pc decline in sales in the group's bulk ingredients business, which was impacted by the cold weather in the US and lower sugar prices. Specialty food ingredients saw volume growth of 4pc in the period driven by a strong performance in emerging markets and Europe. In terms of outlook, the group expects performance to be down slightly year on year reflecting a slow start in its bulk ingredients business and a competitive backdrop in the high intensity sweetener market. "While the overlap between Kerry and Tate and Lyle is limited, Kerry's Ingredients division would see similar underlying market trends to that of Tate and Lyle's Speciality Ingredients business. We forecast lfl volume growth of 4.2pc for Kerry's Ingredients business in FY14," said Goodbody Stockbrokers.