FTSE on the back foot
The FTSE 100 Index was on the back foot today as the US Federal Reserve’s overnight decision on interest rates put pressure on global markets.
The widely-expected 0.25% cut was accompanied by a lack of firm signal over future reductions to aid the economy – disappointing investors and sparking losses on Wall Street which spread to Asian markets.
The Footsie shipped more than 100 points earlier today, but recouped some losses to stand 57.9 points lower at 6479.3 by mid-morning as traders looked for US markets to bounce back later this afternoon.
In London, heavily-weighted banks and miners dragged on the benchmark index, while companies exposed to the US economy also struggled.
Royal Bank of Scotland was down more than 4%, or 20.5p, at 452.75p while Barclays fell 21p to 535p and Halifax Bank of Scotland was off 20p at 796.5p.
Other US-facing firms were hit, such as heating and plumbing company Wolseley, down 25.5p to 734.5p, and housebuilder Taylor Wimpey, off 4p at 219p.
Among the miners, Xstrata’s confirmation of talks over “industry consolidation” did little for its share price, off 50p at 3688p. An HSBC downgrade for copper miner Antofagasta set the firm back 33.5p at 761.5p, while Kazakhmys fell 45p to 1361p.
The leading Footsie faller was crisis-hit mortgage firm Northern Rock, down nearly 7% after reports that private equity firm Cerberus had withdrawn from the race for the business. Shares slipped 7p to 97.4p on the day that its relegation from the top flight is due to be confirmed.
The leading riser was housebuilder Barratt Developments, another firm set for relegation from the FTSE 100 in today’s reshuffle. Its shares were up 12.25p to 498p amid takeover rumours.
Also making progress was Dairy Milk maker Cadbury Schweppes, up 1% or 7.5p to 636.5p as investors reacted to upgraded revenue forecasts in yesterday’s trading update.
