Footsie tumbles into the red after shock house price data

The shock Halifax data dealt a blow to stocks such as Lloyds Banking Group and Charles Church owner Persimmon, with the wider FTSE 100 Index also in the red – down 19.26 points

to 5662.13.

On the other side of the Atlantic, a fall in unemployment claims failed to cheer investors in the US, where the Dow Jones Industrial Average slipped into negative territory.

The US Labor Department said claims dropped by 11,000 to a seasonally adjusted 445,000 – the lowest level since the week ending July 10.

In London, the focus remained on the September house price figures, while the Bank of England also voted to keep rates at 0.5 per cent and its quantitative easing (QE) programme at 200bn.

The market showed little reaction to the Bank's decision, but it gave a boost to sterling – hitting 1.60 US dollars at one stage for the first time since February.

Currency traders had been nervous that the Bank might boost QE support, which would have hit the pound hard.

Yesterday's Halifax figures rattled the banking sector as shares in consumer-focused lenders Royal Bank of Scotland and Lloyds dropped 15/8p to 477/8p and 21/2p to 737/8p respectively.

In the second tier, housebuilder Barratt Developments dropped 41/2p to 943/4p, Persimmon fell 163/8p to 3761/2p and Taylor Wimpey declined 7/8p to stand at 273/4p. Retail stocks weathered the latest economic storm after Marks & Spencer posted a 5.1 per cent rise in like-for-like sales in the second quarter of its financial year.

The retail chain beat City expectations with general merchandise sales up 7 per cent and food sales ahead 3.7 per cent. M&S shares closed up 191/4p at 410p.

The retailer said its adverts, which feature models Twiggy and Lisa Snowdon, as well as X-Factor judge Dannii Minogue and former footballer Jamie Redknapp, had driven more customers into its stores. The update follows largely positive trading reports from supermarkets Tesco and Sainsbury's earlier in the week.

There was no such rally for car parts-to-cycling retailer Halfords after it reported a 6.3 per cent drop in like-for-like sales in the second quarter. It highlighted a disappointing trading performance in the bicycle department and said it would launch more promotions in order to address the downturn.

Shares were down 39p to close at 408p after analysts scaled back profit forecasts.

Elsewhere in the FTSE 250 Index, financial adviser Hargreaves Lansdown slipped 187/8p to 452p after co-founder Stephen Lansdown sold 58m worth of shares in the company, taking his stake down to about 20 per cent.

Rank Group moved 31/2p higher to 125p after the company's third quarter trading update prompted Investec Securities to raise its price target for the Mecca bingo and Grosvenor casino owner. With like-for-like sales up 7 per cent, Investec said Rank had outperformed its expectations amid further signs of operational progress.

The four biggest Footsie risers were Man Group up 121/8p to 2493/4p, Marks & Spencer, Burberry up 25p to 1030p and GKN ahead 31/4p to 1751/4p.

The biggest Footsie fallers were Kazakhmys down 83p to 1400p, Antofagasta off 64p to 1249p, African Barrick Gold down 28p to 610p and Cairn Energy off 183/4p to 4331/2p.