FTSE retreats 13 points
Healthy gains by mining stocks were not enough to prevent the London market starting the week in lacklustre form today.
BHP Billiton was leading the way after investors welcomed comments from analysts that the strong demand in China for commodities will last longer than expected.
But with investors in reflective mood ahead of this week’s Budget, the FTSE 100 Index retreated 13.1 points to 4968.9 by mid-morning.
Although the City expects Chancellor Gordon Brown to give away up to £2 billion to entice voters ahead of the election, there are fears that a higher figure would drive up borrowing and put his fiscal rules at risk.
BHP Billiton was one of the session’s best performers, up 5p at 741.5p, while Rio Tinto gained 7p to 1804p. But Antofagasta reversed early gains to stand 4p down at 1342p.
Uncertainty over oil prices was among the factors driving top-flight stocks lower, with oil cartel Opec scheduled to discuss production levels at a meeting this week.
Although the cost of a barrel of crude oil remained above 54 US dollars in New York, oil giant Shell was unchanged at 492.5p while rival BP advanced just slightly, up a penny at 561p.
Telecoms groups were among the heaviest fallers, with Cable & Wireless weakening 2p to 131p and Vodafone off 1.75p to 137.75p. O2 also chalked up losses of more than 1%, down 1.75p to 126p, as it placed shares and changed its name from mmO2.
Leisure group Whitbread eased 3.5p to 961.5p after the sale of its Marriott hotels for at least £1 billion met expectations. Shares had surged last week when news of a possible deal first broke.
Elsewhere, Bovis Homes rose 15p to 710.5p after it said a pause in interest rate rises helped boost trading.
And bakery chain Greggs ticked up 45p to 4375p after it smashed expectations for annual profits with a rise of 15.3% to a record £46.7 million.
