Liams Last Post : Markets up , Aerl trades better and AIB sells M&T

Good Afternoon ,

 

Good to see markets continue to rally this afternoon after the strong performance from the USA last night. My Colleague Ross published his piece calling for near terms consolidation and it is hard to argue on the face of it with his thesis. Markets have undoubtedly been playing the re-flation trade and lots of stocks are now looking a bit toppy.

In Ireland there is some news from AIB as the Government positions itself to takeover as the largest shareholder by a country mile with the announcement that the Chairman Dan O'Connor is to stand down immediately. Dan is somewhat unfortunate having been appointed after the crisis began but now the government wants a clean out. AIB have a particularly aggressive corporate reputation and have taken a different and by all accounts a more confrontational path in their dealings with the department of finance up to now. Well the piper gets to call the tune and this time Brian Lenihan is not going to be bullied. AIB essentially forced the appointment of Colm Doherty.  AIB announced the appointment of Jim O'Hara, former general manager of Intel Ireland, and Catherine Woods, from JP Morgan Securities as non-executive directors with immediate effect.

The news just out though is more significant and that is AIB has completed the public offering and the sale of its stake in M&T Bank. The process was an offering of contingent mandatorily exchangeable notes ("Notes")  exchangeable  (subject  to  AIB shareholder approval for  the shares of  common stock of M&T Bank Corporation ("M&T")  ("M&T Shares") currently owned by AIB.  AIB sold 26,700,000 Notes at US$77.50 per Note. This is as expected news but good to be done nonetheless.

Aer Lingus succumbed to a bout of profit taking after its strong recent run and gave up todays gains to close -2.18% down after the market digested paragraph two of the trading update which said that at this time, forward revenues indicate that December and  the first quarter of 2011  appear much weaker than anticipated, however, the Group is not yet able to  determine whether this reflects the recent trend towards later bookings or an underlying softness in demand. The market had initially reacted strongly to the tone of the first paragraph where it said that trading in the third quarter, and in the month of September in particular, has been stronger than expected,  primarily as a result  of improved yields  (with growth in line with the second quarter of 2010). Forward revenues suggest that October and November will also be ahead of expectations.

Ryanair never to be out done announced the closure of their Marseille base and that they may open new routes from Stansted in London.  

CRH traded in large volume in the US last night about 10x the average daily volume and closed down -3.4% , there was no news and the stock traded better in Dublin and London today. The sector in Europe had a good day and CRH rallied +0.25% off the closing price in Dublin last night.

Across the market almost all stocks caught the mood and Paddy Power crossed above the eur28 level

 

The FTSE 100 Index  +1.5 %, to 5,747.35 at the 4:30 p.m. close in London, the highest level since April 26. The FTSE All-Share Index rose 1.5 percent and Ireland's ISEQ Index climbed 0.7 percent.  The markets took further impetus from the FED notes that suggested that the FED will launch the much anticipated Quantitave easing programme.  Meanwhile Bloomberg reported that China is to put more reserves into Gold which triggered a rush to a new record spot price of  $1,367.65

 

 

 

 

 

 

 

 

 

___________________________________________

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.