FTSE makes it four good days in a row

The FTSE 100 brushed off big falls in the share prices of Barclays and BT today to record a fourth successive day of gains.

The index of London's leading shares closed up 85.69 points to 4377.34, encouraging investors to hope that the market may have bottomed out after falling more than 40% from last year's peak.

In the past four days it has added more than 500 points to come back from Monday's closing low of 3852.59.

October ended up showing a loss of 525 points, an 11% decrease in value, slightly less of a pounding than the 734 points and 13% that was wiped off the index's value last month.

The highly turbulent month included a 21% fall in the week of October 6-10, at the height of the panic over the health of the UK's high street banks.

Today's winners included the miners and energy companies but the roll call of losers was more eyecatching.

The day's biggest faller was telecoms giant BT, after it issued a profit warning over the "disappointing" performance of its Global Services division.

Investors feared the company would have to slash its dividend, sending shares down 19% or 27p to 115.1p - below the 130p at which BT floated 24 years ago.

Barclays was also hammered amid scepticism about its controversial plans to raise up to £7.3bn from Middle Eastern funds, a deal that will allow it to eschew direct government investment.

At first the proposal seemed to be welcomed as a coup for Barclays, with shares surging 11%, but soon doubts set in as investors realised the deal with the royal families of Abu Dhabi and Qatar would prove costlier than accepting help from the Treasury. Barclays argued that it needed to remain free of government interference.

"We concur with management that 'self-determination' is very valuable", said Collins Stewart analyst Alex Potter. "However, the cost of new capital is commensurately high."

Shares in Barclays tumbled 13% or 26.3p to 178.9p.

Its high street rival HBOS, which along with merger partner Lloyds TSB and RBS has decided to take government money, recorded its fifth successive day's gain, adding 5.3p to 99.3p.

The share price rose by almost two thirds over the week as it approached the 113.6p at which the government is to buy shares and the 119.7p implied value of the Lloyds takeover.

Carnival was down nearly 14% or 214p to £13.55 after the cruise operator said it would suspend its next quarterly dividend as a result of the "highly volatile state of the financial markets".

The company said it would maintain the policy throughout 2009, subject to reviews of market conditions. Suspending the dividend would save about $1.3bn in cash, Carnival said.

Retail stocks suffered after John Lewis said sales at its department store were down nearly 10% in the week ending October 25 and warned of a "testing" Christmas.

Marks & Spencer dropped 11.5p to 219p, Next lost 40p to close at £10.54, while Kingfisher was down 1.3p to 114p.

John Lewis also said sales at its Waitrose supermarkets were effectively flat, which was good news for rivals such as of Tesco and Morrisons. Analysts suggested they would benefit from a "trading down" effect.

Tesco gained 13.4p to close at 339.4p, while Morrisons was up 13p to 263.75p.