FTSE close: Fresnillo up; Centrica M&S down

 

17.30:

Trading Screen

The London market fell into the red today as sliding commodity prices overshadowed forecast-busting growth in the eurozone.

The FTSE 100 closed 19.1 points lower at 5925.87, having spent much of the session in the black, as mining stocks began to follow commodity prices downwards.

Brent crude was slightly lower at 112 US dollars a barrel, while light crude for June delivery on the New York Mercantile Exchange was down 0.8% at 98.18 US dollars.

There was little to cheer the markets from the US, as inflation climbed to its highest level for two and a half years.

The mood in London was helped by first quarter figures showing the economies of the 17 countries of the eurozone grew by 0.8%, bettering the market's expectations of a rise of 0.6%.

The powerhouse German economy grew by 1.5%, while France's output expanded by 1% - boosting hopes of stronger demand for UK exports.

The strong growth made it more likely that the European Central Bank will hike rates, boosting the euro to 0.88 against the pound. Sterling was also down against the dollar at 1.62.

Mining and energy stocks, which had been responsible for much of the top flight's gains in the morning, saw their prices begin to fall back in the afternoon.

Anglo-Swiss miner Xstrata lost 20.5p to 1358p, oil and gas firm BG Group was down 18.5p at 1322p and copper giant Kazakhmys fell 16p to 1213p.

British Gas owner Centrica was among the fallers despite Deutsche Bank introducing a buy rating and noting the stock had underperformed rival utilities by 14% in the last 12 months due to fears about margins.

Centrica's shares, which have recovered in recent days following speculation over a Qatari takeover bid, lost earlier gains and were down 0.9p at 317.3p.

But poor sales figures from department store bellwether John Lewis sparked a slide in retail stocks.

John Lewis said sales excluding VAT were down 3% in the first week of May, creating concerns that April's rise in high street sales would not be sustained.

Next was near the top of the fallers board, down nearly 2%, or 41p to 2281p, while Marks & Spencer was 3.8p lower at 398.4p.

The London Stock Exchange was one of the biggest risers in the FTSE 250 Index, after it increased profits by almost two-thirds last year.

The Exchange, which announced a merger with the Toronto Stock Exchange in February, posted profits of £268m, up 65%, in the year to March. This was despite lower revenues in its core share trading business as competition from newer rivals intensified. Shares were up 1%, or 9.8p to 828.8p.

The biggest Footsie risers were Whitbread up 35p at 1668p, Sainsbury's ahead 7.5p at 362.8p, Petrofac up 30p at 1479p and Aggreko ahead 33p at 1811p.

The biggest Footsie fallers were ITV down 2.1p at 69.4p, Scottish and Southern Energy off 33p at 1335p, Prudential down 13.5p at 735p and Next.

15.45:

Oil services firm Petrofac tops the risers board in the wake of strong results, up nearly 3%, or 42.5p to 1491.5p.

Poor sales figures from department store bellwether John Lewis sparked a slide in retail stocks.

John Lewis said sales excluding VAT were down 3% in the first week of May, creating concerns that April's rise in high street sales would not be sustained.

Next was near the top of the fallers' board, down nearly 2%, or 46.5p to 2275p, while Marks & Spencer was 4.6p lower at 397.7p.

15.10: The Dow Jones has slipped on opening as US investors digest the latest inflation and consumer confidence data. The index is down 24.7 points at 12,671.2.

The FTSE 100 has pulled back from earlier gains as the end of the trading week approaches, although it's still ahead 8.5 points at 5,953.5.

13.40:

The Dow Jones is set to get a boost from the rebound in European stocks, according to futures trading.

The US consumer price index rose 0.4% in April, in line with analyst forecasts.

We have more on annual results from the London Stock Exchange, which generated a better than expected rise in earnings.

The company reported a 22% jump in underlying profit to £341m in the year to March 31, beating predictions of around £314m.

Its shares are up 21.5p at 840.5p.

The FTSE 100 is trading 42.5 points higher at 5,987.5.

'Most of the gains today have been led by sectors that were aggressively sold off yesterday and as such it is clear to see that it's a bit of bargain hunting,' said Joshua Raymond, market strategist at spreadbetter City Index.

Brent crude is at just under $113 a barrel this lunchtime, and gold was fixed this morning at $1,511 an ounce compared with $1,489.5 at the previous close.

11.45

In small caps, Sirius Petroleum rises 10% after an update in which the company says it will focus on the acquisition of Nigerian oil assets with a target minimum recoverable reserves of 20m barrels.

Ashley House, which builds and maintains primary care premises, falls 15% after saying it expects its 2011 profits to be hit by uncertainties around UK government health reforms.

10.00

Strong growth in two of Europe's powerhouse economies and a rebound for commodity prices helped put the London market on the front foot today.

The FTSE 100 index was up 51.1 points to 5,996.1, after first quarter figures showed the German economy grew by 1.5% while France's output expanded by 1% - boosting hopes of stronger demand for UK exports.

'(The) FTSE is firm across the board this morning - it's been a long week and people are taking off their negative bets ahead of the weekend,' said Lex van Dam, hedge fund manager at Hampstead Capital, which has $500m of assets under management.

'Technically the market is still very vulnerable so I would use strength to sell positions,' he said.

Buyers came in for the miners, which rebounded from the previous session's declines in tandem with metals prices as investors shrugged off another bank reserve requirement hike in China.

Silver miner Fresnillo topped the risers' board with a gain of 27p to 1331p, a rise of 2%, while Randgold Resources lifted 79p to 4783p.

The mining sector ranks second in terms of weighting on the FTSE 100, behind integrated oils.

Risk sensitive banks found favour, with Barclays the best off on the back of a Citigroup upgrade to 'buy', although worries over debt contagion in Europe lingered in the background.

Shares in Barclays added 3.9% to 282p.

Other risers included British Gas owner Centrica after Deutsche Bank introduced a buy rating and said the stock had underperformed rival utilities by 14% in the last 12 months due to fears about margins.

Centrica's shares, which have recovered in recent days following speculation over a Qatari takeover bid, were up 5p at 323.1p.

Meanwhile, Marks & Spencer was 1% or 4.5p lower at 397.5p after rival John Lewis reported a 1.4% year-on-year drop in department store sales in the week to last Saturday.

On the second tier, London Stock Exchange topped the leaderboard, up 27.5p to 846.5p after beating full-year results forecasts - a boost for the British exchange which has seen its share of domestic equities trading slump dramatically in the past three years.