FTSE closes flat

FTSE closes flat

Sainsbury’s topped London’s leading shares index after revealing better-than-expected sales on an otherwise lacklustre day for the market.

The FTSE 100 Index closed flat at 5891.95 as traders struggled to find direction in the absence of any surprises in the Budget or any major economic data elsewhere.

Fears over Chinese growth weighed on traders’ minds and dragged on mining stocks, while the retail sector offered some support to the market after Sainsbury’s update.

The pound fell to 1.58 against the US dollar after the Bank of England revealed that two of its members were still pushing for a further increase to its asset purchase facility – otherwise known as quantitative easing. Sterling was up against the euro at 1.19.

Sainsbury’s closed more than 4% or 13.8p higher at 319.3p, after like-for-like sales excluding fuel rose 2.6% in the 10 weeks to March 17, compared with City expectations for a rise of around 2.1%.

The strong trading had a positive impact on Marks & Spencer, which climbed 9.5p to 389.5p, but rival Tesco suffered as Sainsbury’s boss Justin King highlighted the market share gains enjoyed by his business.

Tesco, which issued a rare profits warning at the start of this year, was off 0.5p at 332.3p.

Wolseley, which benefited from a broker upgrade by Credit Suisse, was another top riser with shares adding 65p at 2558p, a rise of nearly 3%, as the City firm raised its expectations for the company’s performance in the US market.

Heavily-weighted miners were among the fallers dragged down by fears over global growth, with Eurasian Natural Resources dropping 20p at 643.5p and BHP Billiton shedding 18p at 1947p.

Engineering group Weir was the biggest faller after US peer Baker Hughes posted disappointing results. Shares were down 6% or 123p at 1859p.

In the FTSE 250 Index, Debenhams climbed for a second session in a row following a strong update yesterday, when the department store chain posted slightly better-than-expected sales figures.

Its shares were 2% or 1.8p higher at 78.3p, alongside a rise of 1.3p to 18.8p for Dixons Retail Group.

The Currys and PC World owner is likely to benefit from the demise of Game Group, which today suspended its shares and announced its intention to appoint an administrator.

Trading halted with the stock at 2.4p, giving the company a market value of just £8m (€9.6m).

Meanwhile, there was cheer in the housebuilding sector despite the threat that a stamp duty raid on houses worth £2m or more could derail the market’s fledgling recovery. Bovis Homes led the way with a rise of 15.6p to 508.5p, while Barratt Developments was 6.3p higher at 148.8p.

The biggest Footsie risers were Sainsbury’s up 13.8p at 319.3p, Randgold Resources ahead 205p at 6595p, Fresnillo up 50p at 1737p and Wolseley ahead 65p at 2558p.

The biggest Footsie fallers were Weir Group down 123p at 1859p, Aviva off 20.7p at 353p, Standard Life down 8.7p at 236.5p and Eurasian Natural Resources off 20p at 643.5p.

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