Big updates fail to maintain FTSE upswing
The London market failed to build on the week’s early recovery today as a flurry of corporate updates disappointed traders and sent the FTSE 100 Index into the red.
Results from the likes of Whitbread, Reckitt Benckiser and oil giant BP weighed heavily on the market and dashed hopes that the top flight may build on yesterday’s rally which took it above the 5200 barrier.
Pressure from across the Atlantic provided further negative sentiment and sent the Footsie 25.5 points lower to close the day at 5182.1.
The Dow Jones Industrial Average stood 21 points down when the market closed in London after US consumer confidence figures underlined weakness in the economy.
In London, Whitbread was the heaviest faller, losing more than 4% as investors looked beyond solid growth at its Premier Travel Inn business to falling earnings at its pub restaurants arm. Shares fell 42p to 921.5p.
Whitbread was followed down by Reckitt Benckiser, which lost almost 4% or 67p to 1724p as a rise in third-quarter profits to £217m (€320.1m) from £204m (€300.9m) met with disappointment.
And record profits by BP in the third quarter also failed to excite investors as concerns lingered over the impact of recent hurricanes.
BP – the UK’s largest quoted company – moved 7.5p lower to 609p after analysts said its net income was slightly below the consensus expectations. Major rival Royal Dutch Shell was also under pressure and eased 12p to 1746p.
Another faller was pharmaceuticals giant GlaxoSmithKline after it halted the enrolment of patients for trials of a new Aids treatment amid fears that it can cause liver damage.
GlaxoSmithKline, which is due to report third-quarter numbers on Thursday, stood 27p lower at 1401p.
The day’s biggest riser was Marks & Spencer after a broker forecast further improvement in sales in both food and clothing buoyed by strong marketing campaigns.
Shares stood well above the 400p benchmark set by Philip Green as he pursued the company, up 4% or 14.5p to 415.75p. Fellow retailer Next also benefited, rising 11p to 1333p.
Elsewhere, fallen telecoms giant Marconi rose 5% or 18.25p to 369.25p after agreeing to sell off the bulk of its assets to rival Ericsson in a deal worth around £1.2bn (€1.8bn).
Marconi effectively put itself up for sale earlier this year after it missed out on a contract from BT – its biggest customer – for the £10bn (€14.8bn) upgrade of its network.
Retail group Carpetright cheered 18p to 913p, despite saying sales remained depressed after deep discounts on its floor coverings failed to attract UK consumers.
And shares in EasyJet were up more than 6% or 17.75p to 300.5p amid speculation it may be the target of a bid.
But Alpha Airport slumped 16% after losing a catering services contract with Thomsonfly. The group, which provides retailing and catering to airlines and airports, saw its shares fall 14p to 72p.
The days biggest risers were Marks & Spencer up 14.5p to 415.75p, Cable & Wireless up 3.5p to 110.5p, Man Group ahead 26p at 1545p, and Rolls Royce up 5.5p to 354.75p.
The heaviest fallers were Whitbread down 42p to 921.5p, Reckitt Benckiser off 67p to 1724p, InterContinental Hotels down 18p at 688.5p and Xstrata down 34p to 1306p.
