Stock market report: Thursday close
The fallout from the banking crisis and stock-market collapse continues to shake investors, who remain sellers of everything connected with the financial sector.
Updated: Latest stock price movements
The latest sell-off follows the decision by US Treasury Secretary hank Paulson to do a U-turn on his $700bn (£458bn) bank bailout.
Instead of using the money to buy up toxic debt, he now plans to follow the lead of the Bank of England and inject the money directly into the banks and others in exchange for shares. His indecision rattled investors and led to last night's 400-point plunge by the Dow.
The financial sector also took a hit in London today. The biggest blue-chip casualty was inter-dealer broker Icap, down 29½p at 255¼p, after Morgan Stanley dropped its rating from equalweight to underweight ahead of results next week. It has also slashed its target from 500p to 195p.
Rival Tullett Prebon, 7¾p cheaper at 164p, which reports tomorrow, has been downgraded from overweight to underweight with its target cut from 710p to 245p. The broker says a drop-off in trading activity will result in a 12% fall in the IDB revenue pool next year.
The continuing drain in stock market values, increased margin calls and redemptions have taken a heavy toll on Man Group, the UK's largest hedge fund operator. Its shares rallied 18½p from a record low to 208½p despite Teathers beginning coverage with a neutral rating and 200p target.
Struggling high Street banks also came under fresh selling pressure. HBOS shed 6.8p to 90p, Royal Bank of Scotland 3.4p to 52.6p and Lloyds TSB 6.3p to 167p. HSBC fell 4½p to 695½p as Cazenove downgraded from outperform to underperform and cut its earnings estimate. The broker is worried about the effects of the recession on the bank's business.
Barclays also shed 10½p to 157.7p. Panmure Gordon has cut its target from 160p to 130p and repeated its sell rating. It says Barclays is exposed to bad news given a potential shareholder revolt ahead of this month's EGM to approve its move to raise an extra £7bn of fresh capital.
Shares in the London Stock Exchange fell 60p to 519½p on the back of a gloomy trading update and the decision to halt its share buyback.
Meanwhile, it's official - industrial output in China is slowing. Any remaining hopes that the country's soaraway economy could pull the rest of the world out of recession have been scuppered, and the Chinese blame slowing demand for goods from Western countries.
Raw-materials prices were on the slide again with copper, zinc and oil marked lower. That quickly hit suppliers such as miners and oil explorers.
Big falls were seen from Fresnillo, down 15.8p at 102.9p, Lonmin, 64½p at 944½p, and BHP Billiton, 22p at 926½p.
Oil producers were also hit, with Cairn Energy, which has huge reserves in India, dropping 67p to 1437p, Tullow Oil 23½p to 453½p and BP 5½p to 471p.
The heavy weighting of the miners and oil companies among the top 100 companies meant leading shares were soon beating a retreat, leaving the FTSE 100 index closing down 12.8 at 4169.2 in another day of wafer-thin trading. This afternoon Wall Street lost an early rally after jobless claims topped half a million for the first time in seven years.
But the Dow then rallied 56.7 to 8339.3 despite the world's biggest retailer Wal-Mart scaling back its earnings forecasts.
Yesterday's half-year results from J Sainsbury, 9½p firmer at 289¼p, were good enough to win over JPMorgan, which has raised its rating from underweight to neutral, but trimmed its target from 330p to 300p.
Euromoney, the publishing group majority owned by evening Standard owner Daily Mail and General Trust, smashed its previous profits guidance to post revenues up 9% at £332m in the year to September. The shares lost 14¼p to 252¼p.
City coverage and share tips
This is Money carries breaking City news throughout the day. Bookmark Companies & Markets and try these markets links...
Tomorrow's agenda
Europe is expected to be declared officially in recession as figures show the eurozone's economy contracting for the second successive quarter. Following a fall in gross domestic product of 0.2% during the previous three months, a further decline of 0.2% is forecast, increasing pressure on the European Central Bank to cut interest rates again next month.
Company winding-up and bankruptcy petition statistics for the third quarter will highlight the extent to which businesses and individuals are feeling the squeeze. Figures from the Ministry of Justice are tipped to show the number of debtors applying for bankruptcy and creditors' petitions rising sharply.
Bellweather of the High Street John Lewis releases weekly sales figures. The department stores group had a 0.3% fall in sales last week, the seventh drop in a row. But sales were still rising at its grocery chain Waitrose.
Most watched Money videos
- Skoda reveals Skoda Epiq as part of an all-electric car portfolio
- Mini Cooper SE: The British icon gets an all-electric makeover
- BMW meets Swarovski and releases BMW i7 Crystal Headlights Iconic Glow
- 'Now even better': Nissan Qashqai gets a facelift for 2024 version
- Land Rover unveil newest all-electric Range Rover SUV
- 2025 Aston Martin DBX707: More luxury but comes with a higher price
- How to invest for income and growth: SAINTS' James Dow
- Tesla unveils new Model 3 Performance - it's the fastest ever!
- Mercedes has finally unveiled its new electric G-Class
- Mini celebrates the release of brand new all-electric car Mini Aceman
- Blue Whale fund manager on the best of the Magnificent 7
- Mail Online takes a tour of Gatwick's modern EV charging station
- Banks should be forced to disclose why they debank small...
- Used car sales hit a five-year high as fresh supply of...
- Don't ditch name and shame plan - it has the City running...
- Snoop Dogg cannabis firm to ditch London after losing 97%...
- Millions kept in the dark over City watchdog's mystery...
- TSB to close one in six branches: More than 6,000 shut by...
- Spring property bounce is a damp squib - Rics estate...
- ITV hit by Hollywood strikes as it pins hopes on Euros...
- Hedge fund tycoon's £34m silver salvage claim sunk at the...
- Air Mauritius lost my luggage and it ruined my holiday:...
- JLR offering £150 a month towards the cost of insuring...
- Investors pull cash out of UK equity funds for the 35th...
- We do need to resolve inequality admits £8m-a-year...
- Drivers abandon Direct Line after insurance premium hikes
- Controversial Brewdog founder James Watt steps downs
- Ford boss says it may restrict petrol models in the UK to...
- Are you a Wetherspoon lover or hater? LEE BOYCE and SIMON...
- Watches of Switzerland buys Italy's Roberto Coin for £104m