FTSE 100 close: Miners, banks prop up Footsie
Banking and mining stocks couldn't quite keep the Footsie in the black today.
Stocks to watch: We round up the latest market news
The FTSE 100 index closed 0.4 points lower at 4,404.8. The Dow Jones was 30.3 points down at 8,734.2.
'A lot of people are sitting on their hands unsure what to do at the moment, whether this rally has further legs on it or it is now reaching a plateau,' said Philip Gillett, sales trader at IG Index.
'The main moves now are going to be data driven just because the market seems to be running out of gas.'
Tomorrow sees the quarterly Footsie reshuffle and the picture was emerging today of who will go up and down.
Leisure group Whitbread and asset management firm Schroders where the highest profile of those at risk of relegation, while the LSE and Wolseley were in line for a return to the blue-chip index.
Shares in Lloyds Banking Group recovered some of yesterday's losses after it announced it would be closing its Cheltenham & Gloucester branches and making about 1,400 staff redundant.
Lloyds acquired the mutual in 1997. Its shares were up 1.9p to 63p, after falling 8% yesterday as the stock left over from its rights issue was placed on the market.
Royal Bank of Scotland and Barclays were also higher, up 0.8p at 36.1p and 6.25p to 290p respectively. But HSBC saw a 5.75p fall to 517.75p, as traders cited concerns that a major stakeholder may need to place shares.
Thomas Cook shares surged 10% today after the collapse of its majority shareholder fuelled speculation about new owners for the travel giant.
The stock started the day as one of the biggest fallers, but was 21.5p higher at 235.75p by lunchtime as analysts said German firm Arcandor's decision to file for insolvency removed recent uncertainty in relation to the 52% holding.
Higher commodity prices lifted shares in Antofagasta, 6p to 649p, and Xstrata, 13p to 721.5p, as well as the rest of the mining sector.
London Stock Exchange shares were back in favour today as the company stands on the brink of a return tomorrow to the FTSE 100 index. The shares were also lifted - 7.5p to 778.5p - by an upgrade to 'outperform' from 'market-perform' from Bernstein Research.
Bernstein sets a target price of 950p on LSE shares and says it expects the potential for cost savings at the bourses operator and low interest rates will drive the stock's performance.
Outside the top flight, shares in financial trading firm IG Group rose 11% or 24.25p to 242p after it delivered a better-than-expected trading update. Mid-cap Heritage Oil was 18p higher to 603p on news it had entered a preliminary deal to merge with Genel Energy International, part of Turkey's Cukurova Group.
Shares in Misys gained 8.5p to 167.25p after Deutsche Bank upgraded its rating for the mid-cap software firm to 'buy' from 'hold' with an increased target price of 200p, up from 135p.
The broker says in a note that although the group's US healthcare technology business is fairly valued, it believes Misys's Capital Markets business is undervalued.
The broker says the banking technology maintenance business has turned around, and there is now upside to its forecasts for Misys based on an early economic recovery.
In small caps, drug company Renovo, which specialises in treatments for scars, rose 1.25p to 28.75p after announcing positive results from a 12-month follow-up analysis for its Juvista product.
Meanwhile, Amino Technologies plunged 6.5p to 54p after KBC Peel Hunt to cut its earnings forecasts for the digital entertainment solutions provider. Amino had issued a trading update, revealing that a shortfall in revenue will lead to an operating loss for the first-half.
TOMORROW'S AGENDA
• Halfords, the car parts and bike retailer, is expected to report a continuing boom in bicycle sales when it reports its full-year results. The firm is also expected to make more on motoring after-sales, as fewer drivers are buying new cars in the recession. Halfords has also benefited from government tax breaks to sell one million bikes in the year to March, and has led the stock market to expect pre-tax profit of about £92m, up on last year's figure of £90.2m.
• Soapmaker PZ Cussons' trading update is expected to show that Britons haven't cut back on keeping clean. The company behind the Imperial Leather brand, which last year splashed out £75m buying the Sanctuary Spa, in Covent Garden, as well as its spin-off products, is forecast to report a resilient update. Panmure Gordon's Graham Jones said that in the current economic environment, 'confirmation that trading continues to be in-line with expectations should be welcomed'.
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