2.5% slump on FTSE

2.5% slump on FTSE

Doubts over the ability of EU leaders to deliver measures to ease the region’s debt crisis triggered a 2.5% slump for London’s leading shares index today.

With a summit of 27 countries in Brussels unlikely to produce a concrete plan to deal with the fall-out from a Greek exit from the euro, the FTSE 100 Index gave up all of Tuesday’s gains to close 136.9 points lower at 5266.4.

The meeting will also discuss how to get Europe growing again, but with Germany opposed to the idea of Europe-wide bonds markets were lower across the world, with the Dax in Germany and France’s Cac-40 sliding more than 2% and Wall Street’s Dow Jones Industrial Average 1% lower at London’s close.

The euro fell against most major currencies including the pound and US dollar, while the price of crude oil also tumbled in line with equity markets. Sterling bought almost €1.25, but it continued to fall against the safe haven of the greenback as it bought just over $1.57.

Fears over Asian powerhouse China were also to the fore after the World Bank cut its economic growth forecast for this year.

The heavily weighted mining sector suffered severe losses amid the increased eurozone uncertainty and Chinese fears with Vedanta Resources off 9% or 95.5p at 951.5p, Kazakhmys down 58p at 679.5p and Xstrata 46.7p lower at 926.2p.

And having attracted bargain hunters yesterday, banks were under pressure with Barclays off 8.4p to 180.5p and Lloyds Banking Group down 1.1p to 26.5p.

Luxury goods group Burberry was among the other fallers, even though its full-year revenues rose 24% to £1.8bn and it reported underlying pre-tax profits of £376 million, an increase of 26%.

Chief executive Angela Ahrendts said the company will continue to invest in its flagship markets including London, Chicago and Hong Kong, but with Goldman Sachs calling the results slightly disappointing shares fell 17p to 1369p.

BSkyB was one of only three top flight risers after the Competition Commission reversed an earlier ruling that there was too little choice for consumers in the pay-TV movies market.

The regulator had been expected to propose a series of remedies but is now not expected to do so after finding that newcomers to the market such as Netflix have widened the choice for consumers.

Shares were 2.5p higher at 693p.

Outside the top flight, FirstGroup shares were 7% or 15.2p higher at 220.1p as analysts said a 1% fall in pre-tax profits to £271.4m represented a reassuring performance after two profits warnings in 18 months.

It also unveiled a strategy to turnaround its bus division, which has seen profitability squeezed by fuel prices and government subsidy cuts.

There was comfort for long-suffering investors in grocery delivery firm Ocado, which rose 6p to 107.8p in the wake of a trading update.

It reported sales growth of 13% for the 12 weeks to May 13, a performance which Panmure Gordon stockbrokers said was better than expected.

The biggest FTSE 100 risers were Smith & Nephew up 2.5p at 594.5p, BSkyB ahead 2.5p at 693p and Aberdeen Asset Management up 0.1p at 241.3p.

The biggest fallers were Vedanta Resources down 95.5p at 951.5p, Kazakhmys off 58p at 679.5p, Man Group down 4.55p at 73.1p and Polymetal International off 45.5p at 794p.

More in this Section

Landlord Yew Grove says its tenants paying almost all rents due this quarterLandlord Yew Grove says its tenants paying almost all rents due this quarter

EU sets up new Covid-19 company fraud unit at EuropolEU sets up new Covid-19 company fraud unit at Europol

Jobs boost for US as lockdown easing sees millions back at workJobs boost for US as lockdown easing sees millions back at work

Passenger numbers in Cork and Dublin airports plunge 99% in April and MayPassenger numbers in Cork and Dublin airports plunge 99% in April and May


Throw all the veg you’ve got into this easy dish.Jack Monroe’s recalibration supper recipe

In a time when our shopping and cooking needs to be efficient and easy, we are bringing back our One List, Five Meals recipe pages.Michelle Darmody's One list, Five meals

What is the future of fashion and how will the ‘high street’ look when this is all over? Corina Gaffey asks those in the knowThe future of fashion: How the crisis will impact the retail industry and what we wear

Surveying the global market, Des O’Sullivan says when the going gets tough, the tough get goingHow art world is putting changed times in picture

More From The Irish Examiner