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Footsie tumbles into red on heavyweight mining losses
The FTSE 100 Index was dragged into negative territory yesterday as insurance and mining stocks weighed heavy on the market.
An early rise on Wall Street in another day of gains after the Federal Reserve's upbeat outlook on the economy failed to provide a boost for London stocks.
The Footsie closed down 27.41 points at 4252.57 after a lacklustre session, clawing back some of the 1.2 per cent rise seen on Wednesday.
The US central bank had sparked advances for the Dow Jones Industrial Average after it said the world's largest economy was shrinking at a slower pace, while also signalling it was in no hurry to hike interest rates.
The Federal Reserve yesterday extended by three months a number of emergency funding facilities and a foreign exchange programme with central banks around the world designed to support lending, saying that some financial markets remain impaired and seem "likely to be strained for some time".
The programmes, which had been scheduled to expire at the end of October, were extended to February 1, 2010.
But in London yesterday, attention was again focused on the mining sector after commodity prices came under fresh pressure, leaving Lonmin down 27p to 1187p, BHP Billiton off 30p to 1365p and Vedanta Resources 26p lower at 1314p.
Insurers were also heading south after Prudential fell 101/2p to 4061/4p, Aviva dropped 63/4p to 3271/4p and Friends Provident declined 3/4p to 661/4p.
Other heavyweights under pressure included Vodafone, which dropped 11/2p to 1171/8p and GlaxoSmithKline after a fall of 261/2p to 10801/2p.
One of the biggest gains of the session came from Royal Bank of Scotland, up 11/4p to 363/4p, after Cazenove upgraded the stock and said the company's new management team was on the right path. The rest of the sector struggled for direction with HSBC down 125/8p to 5051/2p and Lloyds Banking Group off 11/8p to 661/2p.
Standard Chartered fell 28p to 1167p after it reported strong trading in the first five months of the year, but said it remained cautious about prospects.
Elsewhere in the top flight, British Airways shares were on the recovery path amid speculation the airline could turn to shareholders for cash. Shares were 11/4p higher at 1265/8p.
Directories firm Yell was among the pacesetters in the FTSE 250 Index as shares in the debt-laden group continued to recover after their battering earlier in the week. The stock was 3/4p higher at 281/4p, a gain of 3 per cent.
The biggest corporate news of the session came from DSG International after the Currys and PC World owner reported losses of 140m.
However, investors were encouraged by recent signs of trading stability, leaving shares unchanged at 233/4p.
Comet owner Kesa Electricals, which also posted heavy losses on Wednesday, was down 11/2p to stand at 108p.
Meanwhile DS Smith, the UK's leading producer of recycled paper and corrugated packaging survived an 85 per cent fall in profits as shares rose 61/2p to 681/2p.
Pre-tax profits shrank from 109.1m to 16.8m in the year to April 30, after overseas write-downs and cost savings to weather the downturn.
The biggest Footsie risers were Petrofac ahead 27p to 626p, Royal Bank of Scotland, Wolseley lifted 33p to 1078p and Standard Life ended the session 41/4p higher to stand at 1831/8p.
The biggest Footsie fallers were Prudential, HSBC, GlaxoSmithKline and Rio Tinto down 51p to 2080p.
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Sunday 12 February 2012
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