Liams Last Post : Profit taking gives way to more resilience this afternoon.

Good Afternoon,

 

Looking at a chart of the ISEQ performance for the day looks like a broad smile…diving down in the morning and ently rising up again in the afternoon.  The ISEQ closed -1.2% oday thought the financials gave up 0ver 4% on the case of AIB and 3% in the case of Bank of Ireland and -3.5% for irish Life.

 

United Drug results this morning were positively received thought their underlying guidance was maintained. Management guided that they are back in the market for acquisitions and they can spend in the region of Eur100m. This is yet another company clearly signalling a return to more normal conditions though not without challenges.

 

Glanbia upgraded their guidance to mod tees earnings growth which was welcome news in the face f the narrow and unexpected defeat of the proposal by the Co-op to acquire the Dairy business from the plc. A 2% margin is all that lost it. 73 % in favour and he vote required 75% acceptance. We have heard stories of a hurling match in the vicinity which was a bigger draw for some of the co-op members who went there rather than travel to vote. So apathy rather than a coherent no seems to have been a t least a contributing factor. The 75% majority vote was a high hurdle to achieve. Never say never was the word from Glanbia CEO but there is no sign of the co-op rushing to have anther vote straight away.

 

The Airlines and travel stocks were in the news again and Easyjet was the driving feature with a sharp pull back in their guidance arising from Volcanic ash disruption. Easyjet revised their guidance to a range of 100m 1o 150m from 177m and the scale of the impact was felt across the sector with Aer Lingus down -2% , having been down -5%  at its lowest point. Ryanair closed -1.9% down again after recovering off the lows in the afternoon.

 

In Europe there was a continuation of strong earnings numbers from Lanxess which saw volumes +50% year on year and Deutsche Post which saw significant upgrades. European corporate earnings like Irish earnings are on an upgrade cycle though obviously worries about the Sovereign debt problem remain every close to the surface. Again in Ireland Smurfit continues to be strong and closed today at 7.20  down just under -.5% . The share price action here is very indicative of where sentiment is. The market is not selling off this large indebted cyclical even in the midst of all the volatility.  One to watch closely as a leading indicator of sentiment changes,

 

Tomorrow we look to see what Tullow have to say. The stock has retreated sharply in recent weeks , I hope they can re-ignite interest in this one.

 

Have a good evening

 

Liam

 

 

 

 

___________________________________________

Liam Boggan

　

Merrion Stockbrokers

Tel.: 353-1-2404171

Mob:353-87-2313505

www.merrion-capital.com

Disclaimer www.merrion-capital.com/disclaimer.html

Merrion Stockbrokers Limited (registration no. 307878) is a limited liability company whose registered office is at Block C, The Sweepstakes Centre, Ballsbridge, Dublin 4, Ireland.