Soaring oil prices bring FTSE down
London’s blue-chips shed more than 1% today after soaring oil prices and losses for heavyweight sectors undermined trading.
Banks and mining stocks featured on the fallers board as the FTSE 100 Index closed 66.1 points lower at 6204.7, with a tough start on Wall Street adding to the pressure.
Market nerves were frayed by oil prices reaching yet another new record above 126 dollars a barrel, while trade figures added to concerns over the US economy - sending the Dow Jones Industrial Average 1% lower early on.
In London, Carphone Warehouse was the session’s worst performer, down more than 7% as investors expressed disappointment with yesterday’s announcement of a £1.1 billion deal with US consumer electronics group Best Buy.
A sell recommendation from Citigroup in the wake of the retailer’s plans to create a European consumer electronics empire sealed the group’s share prices woes, with the firm dropping 21p to 268p.
Banks joined Carphone Warehouse on the back foot as the Footsie mirrored falls for Europe’s major indices and shipped some of the steady gains seen over the past days.
A downgrade for Barclays by broker Pali International sent the high street banking giant into the red, down 11.5p to 451.5p. Its rivals also suffered, with Royal Bank of Scotland off 10.5p at 347p, Halifax Bank of Scotland down 8.5p at 505p and Lloyds TSB shedding 10.75p to 433p.
Miners were in negative territory as Kazakhmys fell nearly 7% or 128p to 1786p after revealing it had rejected an approach from Kazakh rival Eurasian Natural Resources, which was 19p better at 1307p.
Elsewhere in the sector, Antofagasta was off 32.5p at 777p and Vedanta Resources down 97p at 2400p.
Nuclear power provider British Energy was also a loser as speculation swirled over the group’s takeover saga.
The group’s shares shed 14p to 701p amid a flurry of reports over which suitors were left in the race for the firm and talk that bids were being prepared at the lower end of market hopes.
With oil trading at fresh records meanwhile, British Airways was a casualty. The airline dropped 10.25p to 228.25p as investors braced themselves for more fuel hikes.
Among the Footsie risers, supermarkets fared better, with Morrisons up 2p at 290p after JP Morgan raised its price target and said the group had more operational momentum than its peers. Rival Sainsbury’s was 3.5p better at 398.75p.
Another late gainer was leisure and pubs group Whitbread, up 23p to 1395p after entrepreneur Robert Tchenguiz emerged with a 3% stake in the firm.
In the second tier, entertainment retailer HMV went into reverse after initial gains following an upbeat trading statement. Shares were down nearly 6%, or 8.5p, at 140.75p.
The four biggest Footsie risers were Experian, up 14.25p to 421.25p, Whitbread ahead 23p to 1395p, Eurasian Natural Resources up 19p to 1307p and Unilever ahead 23p at 1775p.
The biggest Footsie fallers were Carphone Warehouse, down 21p to 268p, Kazakhmys off 128p at 1786p, Sage down 12.75p at 213.75p and Persimmon, which was 35.5p lower at 604.5p.
