FTSE close: EU debt blow; Glencore down

 

17.05 (close)

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

The London market slipped to its lowest level since the end of March after fresh fears over the eurozone debt crisis rattled investor confidence.

The FTSE 100 Index fell by 112.6 points to 5835.9 after world markets were spooked by a credit rating downgrade for Italy and renewed speculation that Greece will have to restructure its debts.

The Dow Jones Industrial Average dropped more than 1% as investors in the United States braced themselves for further evidence later this week that US consumer demand may be weakening, while weak economic data from China further worsened sentiment.

The pound was down against a resurgent dollar at 1.61, but was flat against the euro at 1.15.

The soft sentiment saw commodity prices slide as Brent crude oil fell more than 2% and some metal prices also dropped.

Mining was one of the hardest hit sectors in London after a strengthening in the US dollar made commodities more expensive for investors with other currencies.

Stocks under pressure included Anglo American, which declined 4% or 121p to 2830.5p, while Chilean mining firm Antofagasta eased 47p to 1160p.

Commodities trader Glencore, which is due to begin full market trading tomorrow, dropped to 514p during the latest session for conditional dealings, having made its grey market debut at 540p on Thursday.

New York-listed crude oil was below the 97 US dollars a barrel mark, triggering a difficult day for the likes of Royal Dutch Shell, which dropped 51p to 2099p, a fall of 2%.

In a session when only two top-flight stocks made it on to the FTSE risers board, supermarket Morrisons was 2% lower, down 10p to 298.3p, after it was reported to be preparing a £1.5bn bid for food retailer Iceland.

The move would nearly triple the number of stores in the Morrisons estate and boost the chain's presence in south-east England.

Other fallers included plumbing and building supplies firm Wolseley after Deutsche Bank cut the stock to hold and said it was pessimistic about prospects in the new build market. Shares were 82p lower at 1949p, a drop of 4%.

Travel firms were also lower after fears that the ash cloud from an Icelandic volcano would cause disruption. BA owner International Consolidated Airlines Group fell 12.6p to 235p, while Thomson owner TUI Travel was off 7.6p at 229.8p.

Outside the top flight, shares in low-cost airline Ryanair were down 5% to 3.36 euros after it said it expected flat profits this year due to the impact of high fuel costs.

Rival easyJet also dropped 17.6p to 345.1p as investors also considered the possibility that another volcano eruption in Iceland could disrupt the industry for a second time in just over a year.

The biggest Footsie risers were Capita up 11p to 722p, and Next ahead 23p to 2249p.

The biggest Footsie fallers were Wood Group down 37p to 625p, International Consolidated Airlines Group off 12.6p to 235p, Man Group down 11.1p at 238.3p, and Anglo American off 121p at 2830.5p.

16.05: Not much to shout about today - the Footise dropped on opening and has been stuck ever since.

The FTSE 100 is currently 98.47 points lower at 5850.02.

14.45:

US stocks have fallen into the red immediately on today's open - the Dow Jones is 138.8 points lower at 12,373.2.

The FTSE 100 is down 103.8 points at 5,844.7.

13.45:

The Dow Jones is expected to open sharply lower as investors assess bad news on several fronts.

Fears about Greece and other debt-ridden eurozone countries have been compounded by the results of the Spanish elections.

The incumbent socialist government suffered heavy losses as voters reacted negatively to austerity measures.

Sentiment in the US is also likely to be hit by evidence that consumer demand across the Atlantic may be weakening.

'The weakness in Europe is clearly taking its toll on overnight futures,' said Ben Critchley, sales trader at spreadbetter IG Index.

'Last week there were buyers for the FTSE around the 5840 level and for the Dow ahead of 12,350, but with rallies regularly running out of steam in recent weeks, traders may be looking for even better levels before they jump in this time around.'

In London, the FTSE 100 is down 89.9 points at 5,858.6.

It's been a difficult session for commodity-related stocks after the dollar strengthened and the US oil price fell below $99 a barrel. Brent crude was trading at just over $108 a barrel at lunchtime today.

Royal Dutch Shell dropped 40.75p to 2109.5p, a fall of 2%. Other fallers included Anglo American, which declined 4% or 108p to 2843.5p, while Chilean mining firm Antofagasta eased 41.5p to 1165.5p.

Commodities giant Glencore, which is due to begin full market trading tomorrow, dropped to 509p during the latest session for conditional dealings, having made its debut at 530p on Thursday.

Gold was fixed this morning at $1,508.50 an ounce compared with $1,490.75 at the previous close.

12.05:

British Land has issued a bullish full-year update, expressing its conviction that demand for well-located and good quality shop and office space will continue despite the UK's 'age of austerity'.

It unveiled a 12.5% rise in net asset value per share to 567p in the year to March 31. Underlying annual pre-tax profit was up 2.8% at £256m.

The property firm's shares nevertheless fell 14.5p to 578p.

Rival Land Securities, which issued well-received figures last week, is down 10.5p at 779.5p today.

The FTSE 100 is 93.9 points lower at 5,854.7.

11.40:

The FTSE 100 continues to languish 98.53 points lower today at 5849.96.

We have more on the warning from Bank of England Monetary Policy Committee member Spencer Dale warning that interest rates must rise soon.

The Bank's chief economist said in a Financial Times interview that he could see a quarter point rise in rates this year, followed by more rises over the next two years.

The pound has strengthened from €1.132 on Friday to €1.152 today but market traders said the euro's weakness was the dominant factor.

Don't miss our interest rate round-up.

10.30:

Ryanair has reported a 26% rise in annual underlying profit to £348m, which it declared itself pleased with considering high oil prices, the global recession, and the volcanic ash disruption at the start of last year.

But the budget airline admitted passengers face a 12% rise in average fares in the current financial year as it seeks to pass on soaring fuel costs. This follows a 12% hike last year.

Shares in Ryanair are down €0.20 at €3.38 as the carrier acknowledged that it expected this year's profit to be similar to last year's result. Read more here.

The FTSE 100 is down a hefty 105.2 points at 5,843.3.

09.50:

The FTSE 100 suffered heavy selling today as oil price falls hurt commodity stocks and sentiment was knocked by more downgrades to EU economies.

The FTSE fell more than 1.5% on opening and is currently 92.84 points lower at 5855.65.

Fears over the US economic recovery and ongoing worries about Europe's debt crisis put world markets on the back foot.

The FTSE 100 Index slid more than 1.5% or 95.7 points to 5852.4, while Asian markets slumped by a similar level earlier in the day.

Credit rating downgrades for Italy and Greece and further signs that US consumer demand may be weakening were blamed for the sell-off.

Oil prices were also below 99 US dollars a barrel as a stronger greenback made commodities more expensive for investors with other currencies.

One of the biggest fallers in London's top flight was plumbing and building supplies firm Wolseley after Deutsche Bank cut the stock to hold and said it was pessimistic about prospects in the new build market. Shares were 84p lower at 1947p, a drop of 4%.

In corporate results, shares in building services firm MITIE jumped 4% or 7.85p to 217.85p after it posted a 9% rise in annual pre-tax profits to £86.8 million and said it was well placed for sustainable growth.

Meanwhile, shares in low-cost airline Ryanair were down 5% to 3.3 euros after it said it expected flat profits this year due to the impact of high fuel costs. Rival easyJet also dropped 18.65p to 344.05p.

{"status":"error","code":"499","payload":"Asset id not found: readcomments comments with assetId=1724144, assetTypeId=1"}