FTSE close: BA, Next down; 888 up

 

17.30 (close)

Dealers monitor their screens on the trading floor of IG Index in London

Taking stock: Trading is winding down ahead of the Christmas period.

Commodity and banking stocks briefly pushed the FTSE 100 past the 5900 mark today before it slipped back again.

The Footsie shrugged off rising tensions in Korea and the ongoing sovereign debt crisis in Europe to close 19 points higher at 5891.6.

Hopes that an extension to tax cuts in the US signed off by President Barack Obama on Friday will lead to economic growth boosted sentiment and offset the impact of icy weather on travel and retail stocks.

The pound was up against the euro at 1.18, as the single currency continues to struggle in the face of debt worries. The pound was also up against the dollar at 1.55.

With passengers stranded at airports across the country, British Airways closed at the top of the fallers' board, 5p lower at 265.2p.

The snow and ice also meant many shoppers were unable to reach the high street on what is normally one of the busiest weekends of the year for UK retailers.

Next dropped 17p to 1968p, while Marks & Spencer slipped 2.5p to 372.9p and Tesco dropped 3.3p to 430.1p. Other notable fallers included Whitbread - the owner of coffee shop chain Costa and Beefeater restaurants - which declined 4p to 1801p.

Outside the top flight, Dixons Retail Group dropped 1.5p to 22.8p and HMV Group, owner of book shop Waterstone's, fell 2.6p to 28.9p. JD Sports Fashion weathered the storm as shares in the highly-rated retailer rose 30p to 890.5p.

The US tax deal was enough to bring traders' attention away from the eurozone debt crisis, despite Moody's downgrading a number of Irish banks.

The banking sector consequently enjoyed a better session, after Friday's warning from Lloyds Banking Group that it would take additional bad debt charges on its £26bn Irish loan book.

Lloyds fought back from earlier losses and added 0.4p to 66.9p, as Barclays also recovered from a weak start to stand 1.3p higher at 261p.

Royal Bank of Scotland, which also has extensive exposure to Ireland, gained 0.6p to 38.5p as it recouped losses seen before the weekend.

Investors were also focused on the gambling sector after Ladbrokes confirmed it was in talks over a possible deal to buy online firm 888 Holdings.

The takeover interest, which is reportedly priced at around £240m, would allow Ladbrokes to strengthen its online offer, which industry insiders say has lagged behind those of its rivals.

Shares in 888 jumped 18% or 8.8p to 57.6p and Sportingbet rose 0.7p to 59.7p on hopes of further consolidation in the sector. But Ladbrokes investors were non-plussed by the potential deal as shares slipped 1.5p to 126p.

The biggest Footsie risers were Schroders up 42p at 1440p, BT ahead 4.7p at 187.1p, Petrofac up 38p at 1551p and Aggreko ahead 36p at 1570p.

The biggest Footsie fallers were British Airways down 5p at 265.2p, Autonomy off 23p at 1520p, Vedanta down 27p at 2395p and Shire off 14p at 1516p.

15.20: Over on Wall Street, the Dow Jones has opened higher after President Barack Obama signed an $858bn package on Friday to renew tax cuts for another two years.

In London, the FTSE 100 is 27.65 points higher at 5899.4.

14.35:

The Footsie is holding firm, 31.48 higher at 5903.23.

The blue chip index is now within touching distance of 6,000, but with thin trading expected this week, it has an uphill battle to reach it.

12.40:

A lunchtime update – the FTSE 100 is 37.59 points higher at 5909.34 thanks to gains from miners and utility companies.

The rally came despite further tensions on the Korean peninsula and the weather-related impact on certain blue-chip stocks.

With passengers stranded at airports across the country, British Airways was the leading faller for a spell before settling 3p lower at 267.2p.

The snow and ice also meant many shoppers were unable to reach the high street on what is normally one of the busiest weekends of the year for UK retailers.

Next is leading the FTSE 100 Index fallers with a drop of 27p to 1958p, down 1%, while Marks & Spencer slipped 4.3p to 371.1p and Tesco dropped 0.6p to 432.8p. Other notable fallers included Whitbread - the owner of coffee shop chain Costa and Beefeater restaurants - which declined 5p to 1800p.

Outside the top flight, Dixons Retail Group dropped 1.1p to 23.2p and HMV Group, owner of book shop Waterstone's, fell 2.5p to 29p. JD Sports Fashion weathered the storm as shares in the highly-rated retailer rose 31p to 891p.

The banking sector endured a mixed session in the wake of Friday's warning from Lloyds Banking Group that it would take additional bad debt charges on its £26bn Irish loan book.

Lloyds dropped another 0.2p to 66.3p but Barclays recovered from a weak start to stand 1.85p higher at 261.6p while Royal Bank of Scotland, which also has extensive exposure to Ireland, gained 0.8p to 38.6p as it recouped losses seen before the weekend.

11.25:

The FTSE 100 has taken an upward turn, despite some gloomy economic forecasts this morning.

The Footsie is 31.94 points higher at 5903.69.

Investors seem unperturbed by a downgrade in its economic forecast from the Confederation of British Industry.

The economy will grow by 2% next year and 2.4% in 2012 the CBI predicts, slightly slower than the 2.1% and 2.6% expected by the Treasury. Read more here.

In equities, Aggreko has scored a £37m contract to become the exclusive power supplier to the London 2012 Olympic and Paralympic Games.

Its shares rose 11p to 1,545p in morning trading. There's more here.

09.25:

The FTSE 100 crept higher today in thin trading despite knocks for snow disrupted British Airways and Next.

The Footsie was 3.41 points higher at 5875.16 in early trading.

The UK's big freeze had an impact on shares with falls for airline British Airways and retailers including Next.

Passengers found themselves stranded at airports across the country and many shoppers were unable to reach the high street during what is normally one of the busiest weekends of the year for UK retailers.

British Airways shares fell 2% or 5.6p to 264.6p but the wider FTSE 100 Index held firm, up 6.3 points at 5878 despite the blow to confidence caused by more tensions on the Korean peninsula and further losses for banking stocks.

Investors were also focused on the gambling sector after Ladbrokes confirmed it was in talks over a possible deal to buy online firm 888 Holdings.

Shares in 888 jumped 19% or 9.25p to 58.25p and Sportingbet rose 0.15p to 59.1p on hopes of further consolidation but Ladbrokes slipped 0.1p to 127.4p.

Lloyds Banking Group dropped 1.1p to 65.4p as analysts calculated the cost of Friday's warning that it would take additional bad debt charges on its £26bn Irish loan book.

Barclays fell 2.75p to 257p but Royal Bank of Scotland, which also has extensive exposure to Ireland, improved 0.4p to 38.2p.

Among the retailers, Next fell 24p to 1961p, B&Q owner Kingfisher dropped 0.6p to 254.8p and Marks & Spencer slipped 1.9p to 373.5p. Small-cap stock HMV, which owns book shop chain Waterstone's, fell 2.5p to 29p.

The pound at 9am was at $1.5553 compared to $1.5486 at the previous close. Against the euro the pound was at €1.1819 compared to €1.1770 at the previous close.

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