Liams Last Post : Subdued markets , pull back brings stocks into attractive territory once again.

Good Afternoon

 

A quietly subdued day in the markets , time for a bit of a pause after a few days if strength , the Irish Financials continue to be a tad nervous , the media story about Irish Nationwide and the EBS having to both submit separate business plans to the EU appears to be about to delay any advancement of the notion of the creation of the third banking force. This news was not helpful to irish Life which seems to be attracted like a magnet to the Eur3,00 lelvel as an upper bound of its trading range.

 

The news that Sean Fitzpatrick has been arrested was greeted with nary a tear shed in Dublin. Financial irregularities was all the news said. I think the court of public opinion will be pleased to see some people being held to account for the debacle.

 

There was an interesting article in the New York Times on Ireland which suggested that that the lessons that the US could learn from Ireland is that the Banks which are prone to recklessness should be limited in size relative to the size of he economy and be forced to hold more capital. The article went on to basically suggest that while Ireland is the poster boy for good behaviour in response to the disaster that the policy measures undertaken by Ireland which are now seen as standard practice were not the only solution and that the state could have forced the Big Banks creditors and bond holders to have taken some of the pain instead of transferring the pain directly to the taxpayer.

 

Smurfit Kappa has come under pressure over recent days,  The huge rally in the price of OCC (Old Recycled Container Board ) has been seen negatively by markets. The issue is whether the price increases which have been announced recently will flow to the bottom line or to what extent they are offsetting the increased costs of OCC. Either way sentiment is fragile here now with downgrades from International as well as local brokers on the stock.

 

Paddy Power is having a seasonal outing as the marker realises his years Cheltenham is a bookies fest with a reall ppsitive run of results favouring the bookmakers all through the festival thus far.  Paddy Power closed +3.6% today.

 

Internationally the FEDEX numbers which were positive underlined a regaining in the US economy and news from Lloyds list suggested that Order books for new Cargo ships were up 870% in China in the first two months of the year.

 

Glanbia was remarkably strong today on decent volume suggesting that the Co-Op placing might find considerable appetite at these levels given the already attractive price of the stock.

 

A feature in the afternoon was the surrendering of some of yesterdays performance by the US and Irish construction stocks after the positive news of yesterday in relation to highway contract awards.

 

Total produce slipped back also towards pre results levels ,,, I am looking for an opportunity to get back into this one , I was surprised by the rn after the results as I thought there was nothing really special in it in terms of new news and certainly no transformational deal on the horizon but if the price eases back it could become attractive once again.

 

Have a good evening

 

Liam

 

 

 

 

 

 

___________________________________________

Liam Boggan

　

Merrion Stockbrokers

Tel.: 353-1-2404171

Mob:353-87-2313505

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