FTSE slips
Banking stocks sustained fresh losses today as the crisis of confidence in the the US mortgage market crossed the Atlantic to batter London stocks.
Barclays slid to a 10-year low, while Royal Bank of Scotland and Halifax Bank of Scotland were both down by 8% as analysts worried about the sector’s need for additional capital.
Having opened in positive territory, the FTSE 100 Index slipped 48.6 points to 5123.3 as the London market tested new three-year lows.
Fears over the exposure of RBS’s American operations to the faltering US mortgage market meant its shares tumbled 14p to 153.3p. And the drop of 22.5p to 237.5p for HBOS took the lender further away from its 275p rights issue price.
With Friday’s deadline for the bank’s £4bn (€5bn) cash call looming, underwriters look likely to pick up the tab for the fundraising.
Barclays shares dropped 17p to 243.5p and left the bank at a level last seen in the autumn of 1998.
On top of concerns about their capital positions, banks were hit by a critical report on the current account market from the Office of Fair Trading.
The banking stocks were joined on the fallers board by building supplies firm Wolseley, which told shareholders it would not pay a full-year dividend in September. Battered by a rapid downturn in UK trading conditions, Wolseley shares slipped 21p to 269.25p.
In the FTSE 250 Index, JD Wetherspoon shares rose 5% or 9.5p to 184.25p after reporting better-than-expected sales figures.
The business, which has around 700 pubs and 20,000 staff, reported a 0.4% increase in like-for-like sales for the 11 weeks to July 13. This compares to a 0.1% decline during the quarter to April 27.
Trinity Mirror was the biggest FTSE 250 faller, off 7.25p at 47.5p.
