Wall St affects FTSE
Heavy losses on Wall Street weighed on the London market this afternoon as it gave up gains made earlier in the session.
The Dow Jones Industrial Average lost more than 60 points in early trading after data from a number of US retailers disappointed investors in New York.
The weak sentiment spread over the Atlantic to London where the FTSE 100 Index closed 11.1 points down at 5833 – having moved back towards the 5900 mark earlier in the session.
It marked the continuation of a roller-coaster week for the London market which saw the top flight hit a new four-and-a-half year high on Monday, before shedding more than 80 points the following day.
The financial sector drove the Footsie forward early on as results from Norwich Union owner Aviva and bank Standard Chartered cheered investors and sent the stocks 4% higher.
Standard Chartered was today’s biggest climber in London – up 56p to 1527p - after reporting a 19% rise in pre-tax profits to 2.6 billion US dollars, which analysts said was at the top end of expectations.
It was followed north by Aviva, which unveiled an operating surplus of £2.65bn (€3.85bn). The stock rose 29p to 820p as investors applauded its profits and decision to ditch its 5% dividend growth target to pay an increase of 9%.
The enthusiasm was replicated elsewhere in the insurance sector where Royal & Sun Alliance gained 3.25p to 132.5p and Friends Provident moved half a penny higher to 207.75.
But Prudential and Legal & General gave up early gains to fall 4.5p to 602.5p and 0.5p to 129.5p respectively.
There was a similar story in the banking sector as a number of stocks failed to follow Standard Chartered’s lead.
Halifax and Royal Bank of Scotland owner HBOS continued to struggle after yesterday’s sell-off, sinking a further 18.5p to 999p, while Alliance & Leicester was also in the doldrums, losing 16p to 1069p.
The mining sector offered some buoyancy as Xstrata hit an all-time high, but oil stocks also surrendered early gains to drag the market lower. BP was 2.5p off at 635p, while Royal Dutch Shell lost 12p to 1827p.
Analysts continued to be delighted by Xstrata’s strong results yesterday, which made it the top riser of that session.
The stock put on a further 17p to 1774p today, while rivals Antofagasta and Kazakhmys were also in positive territory – up 22p and 30p to 2095p and 919.5p respectively.
Elsewhere, newspaper group Trinity Mirror fell 5p to 575.5p as investors concentrated on a tough outlook despite the publisher overcoming a downturn in advertising revenues in 2005 to increase pre-tax profits to £220.9m (€320m) from £208.5m (€303m) in 2004.
And soft drinks maker Britvic slumped 23% or 63.5p to 210.5p after warning that slowing growth in the UK market had put it on course for profits at the lower end of expectations.
The day’s biggest blue chip risers were Standard Chartered up 56p to 1527p, Aviva up 29p to 820p, Kazakhmys 30p higher at 919.5p and Royal & Sun Alliance 3.25p stronger at 132.5p.
The heaviest fallers were PartyGaming down 4.5p to 122.5p, InterContinental Hotels off 22p to 847.5p, British Energy group 14p lower at 610p and Amvescap down 11.25p to 527.75p.
