World markets in the red
World markets wallowed in the red today as investor confidence was hit by fears over slowing growth in Asian powerhouse China.
Wall Street’s Dow Jones Industrial Average fell 0.5%, while the FTSE 100 Index in London lost more than 1% or 64 points at 5896 following a senior executive at BHP Billiton’s comment that China’s demand for iron ore was “flattening out”.
Stocks have been buoyant in recent weeks as upbeat US economic figures and easing concerns over Europe’s debt crisis lifted traders’ spirits.
But in light of China’s recent announcement that it has lowered its annual economic growth target to 7.5% from 8%, shares in the mining sector took a hammering.
Commodity stocks dominated the fallers board with Mexican silver producer Fresnillo down 6% or 106p at 1670p, Vedanta Resources off 67p at 1351p and Antofagasta down 42.1p at 1203p.
There were also losses for firms dependent on the strength of global demand, such as car and aerospace parts supplier GKN, which fell 7.6p to 207.8p.
Financial stocks were depressed with Lloyds Banking Group down a penny at 36.3p and Royal Bank of Scotland off 0.7p at 28.4p.
Vodafone was at the top of the risers board after India’s supreme court rejected the government’s appeal over a recent ruling that the mobile phone giant is not liable to pay taxes on an acquisition in 2007.
Shares were up more than 2%, or 4p to 171p.
Arm Holdings, the Cambridge-based designer of chips for Apple’s iPad was also in positive territory after Barclays Capital raised its price target on the back of the boom in sales of smartphones and tablet computers. Shares were up by as much as 9p at one stage before settling 4p higher at 584p.
Department store chain Debenhams was also faring well in the FTSE 250 Index after a trading update showed a better-than-expected start to the year.
Like-for-like sales at the group, which has 170 stores in Ireland, the UK and Denmark, increased 2.4% in the eight weeks to March 3 – significantly better than the flat performance in the previous 18 weeks.
Shares were 1.5p higher at 77.2p but were beaten to the top of the FTSE 250 Index risers board by Cable & Wireless Worldwide after reports said Tata Communications was planning to make a formal offer for the telecoms firm.
It is in competition with Vodafone for the hand of C&WW, in a battle that is expected to come to a head before the end of the month. C&WW rose 2.5p to 37.4p.
Elsewhere, serviced office provider Regus slipped 8p to 104.8p, giving up recent gains, despite announcing that operating profits more than doubled to £50.6 million last year.
