FTSE closes down slightly
The FTSE 100 Index closed the year on the back foot but the fall was not enough to take the shine off annual gains of almost 11%.
The Footsie closed 20.1 points lower at 6220.8 but it was 602 points higher than its opening of 5618.8 on the first day of trading in January.
However, the fall meant that the blue chip index did not finish the year above the 6260 reached earlier this month, which was the highest level since February 2001.
But analysts remain hopeful of fresh gains in the new year, particularly as merger and acquisition activity looks set to continue. Some market watchers believe the Footsie can go on the beat the all-time high of 6930 which was recorded seven years ago. As expected, volumes were light ahead of the lunchtime finish for the stock market.
Few trends emerged in dealings, although ICI was up 0.75p to 452p as takeover speculation continued to buoy shares in the chemicals company. The gains come amid reports that the Dulux firm was the most likely target for paints company Akzo Nobel.
Meanwhile, lending data confirming the continued strength of the housing market gave a further boost to housebuilder Persimmon, which rose 16p to 1526p.
The rise came after the British Bankers' Association (BBA) said mortgage lending hit a record £21.4 billion last month - up 13% on October's total and 19% higher than the same period last year.
And mining stocks were on the rise as they finished a strong year in positive territory. Kazakhmys was up 15p to 1110p while Lonmin gained 10p to 3010p and Antofagasta lifted half a penny to 509p.
Among stocks pulling the Footsie lower, oil giant BP fell 4p to 567.5p and rival Royal Dutch Shell dipped 12p to 1790p as the mild winter weather continued to keep a lid on the cost of crude. Cairn Energy, however, was 21p higher at 1799p.
The banking sector was also in decline as it suffered from light trading volumes after recent gains. Barclays was down 7p to 730p, Alliance & Leicester was off 6p to 1138p and Northern Rock fell 9p to 1178p.
