FTSE Close: BP, Dairy Crest up; Tesco down

By Ed Monk for Thisismoney.co.uk
Updated: 12:38 EDT, 30 September 2010

The FTSE 100 Index finished in the red today but that did not prevent it enjoying its best September for 13 years.

Taking stock: Investors will be focused on the final reading for US second quarter GDP

The FTSE, which has added 6.7% over the month, dipped in and out of the red throughout the day and finally closed 20 points down at 5548.

Stock market historian David Schwartz said it was the best September since 1997, when the Footsie climbed 7% during the month.

The trading day started with concerning European news, as rating agency Moody downgrading Spain to Aa1, while the Irish government said the total cost of bailing out Anglo Irish Bank was 34 billion euros (£29bn).

But improved US data lifted the mood later in the day, with the final second quarter GDP revision coming in slightly better than expected at 1.7%, while weekly jobless claims fell to 453,000 from 465,000 the previous week.

Wall Street opened higher on the final day of what is expected to be the best September in 71 years for US markets.

In the face of strong US data, the pound was down against the dollar at 1.57, while it was lower against the euro as well, at 1.15.

Fears over the European debt crisis hit the banking sector, with Barclays down 5.6p 299.6p and HSBC down 4p at 645p.

With the dollar under pressure amid concerns that the US Federal Reserve will reopen its quantitative easing programme, the price of gold set a new high above 1,300 US dollars an ounce as investors continued to see the precious metal as a safe haven.

Mining stocks were cheered as Lonmin added 2p to 1669p and Eurasian Natural Resources lifted 14.5p to 918.5p.

The oil and gas sector helped push the market up earlier in the day with BP leading the charge and Royal Dutch Shell not far behind. Shares were up 6.8p at 427.8p and 5.5p at 1916p respectively.

BP leapt ahead after yesterday's move by new chief executive Bob Dudley to set up a safety division as part of efforts to rebuild the company's shattered reputation following the Gulf of Mexico disaster.

The new boss also hinted in an interview that dividend payments to shareholders could be restored in the new year.

On the downside, shares in catering giant Compass dropped 21p to 530.5p, making it the FTSE's biggest faller, despite another solid sales performance in the fourth quarter.

Outside the top flight, Dairy Crest rose by another 2% after it said increased profits in its cheese business underpinned growth at a time of intense competition in the milk supply market.

The stock, which added 8.2p to 380.5p today, was also higher yesterday after announcing a new five-year supply contract with supermarket Morrisons.

The biggest Footsie risers were Man Group, up 5.9p at 219.1p, Burberry Group, ahead 20p at 1040p, Smiths Group, up 23p at 1219p, and BP, ahead 6.8p at 427.8p.

The biggest Footsie losers were Compass Group, down 21p at 530.5p, Standard Chartered, off 55p at 1826p, ARM Holdings, down 10.6p at 392.2p, and Tesco, off 9.3p at 424p.

15.50: With the end in sight, the FTSE 100 is finishing handsomely.

The Footsie, spurred by that US GDP upgrade, is now 59.27 points higher at 5628.54.

14.20:

The final reading of US GDP has come in... at 1.7% for the second quarter.

That is an iumprovement on the 1.6% growth in place from the second reading.

The markets have lapped that up, reversing losses and heading into positive territory.

The FTSE 100 is now 47.31 points higher at 5616.58.

13.05:

Outside the top flight, Dairy Crest rose by another 2% after it said increased profits in its cheese business underpinned growth at a time of intense competition in the milk supply market.

The stock, which added 6.1p to 378.7p today, was also higher yesterday after announcing a new five-year supply contract with supermarket Morrisons.

Other risers included waste management company Shanks after it said pressure on the government to meet tough targets to reduce the amount of waste put in landfill by 2013 would insulate it from spending cuts.

Shanks, which rose 3% or 2.9p to 114.2p, has also sold nearly all its stake in two waste contracts for £25m in a move that will allow it to pay down debt.

13.00:

Icap is still the biggest faller of the day following it's trading update this morning.

The shares are currently 16.5p, or 3.8%, lower at 421.3p. Those losses seem to setem from a statement in the trading update that 'Increased interest costs resulting from the previously diclosed refinancing of ICAP's debt facilities reduced earnings growth.'

Overall, the FTSE is 11.66 points lower at 5557.61.

11.55:

The FTSE 100 was clawed back most of the early losses today.

The Footsie is currently 4.38 points lower over the session at 5564.89.

On Wall Street later today, furtures markets predict that the Dow JOnes will open down 21 points at 10,759.

10.40:

The FTSE 100 was heading for a limp end to September, falling today after nerves in the US and with Icap leading the majority of blue chips downwards.

The Footsie stood 24.48 points lower at 5544.85 with 69 of the 100 companies in the red. It represents a weak end to the month of September, in which the index has added 6%.

Investors are nervous ahead of key data in the United States later in the session. Weekly jobless claims and the final reading of the country's second quarter GDP figure added to nerves on Wall Street, where the Dow Jones Industrial Average closed slightly lower last night.

There was further pressure following Moody's downgrading of Spanish debt, while the price of gold set a new high today at above $1,300 an ounce as investors continued to see the precious metal as a safe haven.

In corporate news, Icap was the heaviest faller of the morning, down 15.1p, or 3.45%, after a trading statement in which the company said increased interest costs resulting from refinancing of ICAP's debt facilities have reduced earnings growth.

Oil giant BP stood out during a quiet session for share price movements, climbing 2%, or 6.75p to 427.85p, after yesterday's move by new chief executive Bob Dudley to set up a safety division and rebuild the company's shattered reputation following the Gulf of Mexico disaster.

In currency, the pound at 9am was $1.5852 compared to $1.5809 at the previous close. Against the euro, the pounds was at €1.1646 compared to €1.1597 at the previous close.