Good Afternoon ,
Today we saw generally weaker markets with a mixture of Irish Bond spreads gone wild and the 10 year now trading at 8.62% ... and commentators suggsting that there is no liklihood in the short term that these yields will come in. Goldman Sachs Chief Strategist again saying that there is a rising probability that Ireland will need help from the ESFS fund ( andi know some of you think this stands for the European Science fiction society) . The bond market rout represents a run on the country and a short trade into the budget and the bye elections. it is a packed one way trade and there is no obvious trigger inthe next few weeks to turn sentiment so there is no one likely to stand up to the plate and take on t he market. Certainly no one local...Patrick Honohan made some comments about Bond yields not staying where they are and his comments took only seconds to be tweeted on Zero Hedge withthe addendum that they are not going to be lower... gives an indication of where sentiment is ...
The continued fall out on the bond spreads had little further impact on Bank prices already decimated in the last couple of weeks.
The corporate news relaeases continued on a positive vein today with Smurfit Kappa and Tullow. Tullow had an IMS which added little new reaal info but no bad news so the stock drifted initially then rallied into the close to finish +1.26%
SKG reported numbers which were ok, the market still is having problems grappling with the bullish tone of the statements and the somewhat rising EBITDA but also no serious dent being made in the overall levels of debt paydown. Jam tomorrow as always and yet the market cant quite make up its mind which direction to play this definitively.
CRH showed signs of being tired post the recent strng rally. Indeed the entire European building materials ssector looks a bit tired and toppy and susceptible to a bout of profit taking. I would be more bullish longer term for the sector and all the companies suggested this quarter is the rela inflection point so I would be watchful for entry opportunities if there is profit taking.
There was also some big moves in the dollar this afternoon and silver prices were down sharply again all after the recent big moves.
Hope you have a good evening
Liam
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Liam Boggan
Merrion Stockbrokers
Tel.: 353-1-2404171
Mob:353-87-2313505
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www.merrion-capital.com/disclaimer.htmlMerrion Stockbrokers Limited (registration no. 307878) is a limited liability company whose registered office is at Block C, The Sweepstakes Centre, Ballsbridge, Dublin 4, Ireland.
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