Heavy profit-taking dragged London markets into the red today as shares in blue chip heavyweight Vodafone remained at their lowest level for three years.
Only a handful of top flight stocks made it into positive territory as the FTSE 100 Index shed 84.4 points to close at 5791.5 today.
It followed a fresh four-and-a-half year high in the previous session as investors and traders tidied their books by banking strong gains for the year so far.
More than 750 million Vodafone shares changed hands – compared with around 90 million for the next most traded stock – as investors continued to fret over the company’s asset write-down.
The stock slipped heavily for a second day running – this time down 4% or 4.75p to 109p – following yesterday’s warning of slowing revenues growth and an impairment charge that could be as high as £28bn (€41.2bn).
Oil stocks were also out of favour after the cost of crude weakened again. Shares in BP and Royal Dutch Shell fell 2% each, or 14.5p to 630p and 32p to 1795p respectively.
And the lower price of metals on the global market hit miners, with Rio Tinto off 83p to 2680p and Anglo American 37p lower at 2127p.
It took the shine off a good day for Royal Bank of Scotland, which made the running among Footsie stocks after investors received a 25% dividend boost to go with better-than-expected annual profits of £7.9bn (€11.6bn) and the return of £1bn (€1.5bn) capital via a share buyback.
Shares were up by 3%, rising 50p to 1909p, while HBOS benefited with a gain of 6p to 1062p as investors prepared for the company’s own results tomorrow.
But the performance of RBS added to the disappointment surrounding Alliance & Leicester yesterday, as shares dipped 56p to 1069p, a fall of 5%.
RBS was followed by British American Tobacco after it achieved a 9% rise in underlying profits and said it had identified an additional £80m (€117.7m) of cost savings. Shares were up 31p at 1359p, a gain of 2%.
In the second tier, GKN surged by more than 7% after it impressed investors with better-than-expected profits and said its outlook for growth in 2006 and 2007 appeared strong. It also announced a £200m (€294.2m) injection into its pension fund, lifting shares by 23.25p 339.75p.
Recruitment company Hays gained 9.5p to 148p following its results, while a restructuring plan at MFI drew a positive response as shares rose 3% or 2.25p to 91.75p.
And magazines group Emap jumped 32p to 950.5p, following the announcement that it planned to sell its struggling business in France.
Back in the top flight, poker giant PartyGaming experienced a rollercoaster session as it failed to overcome the surprise departure of chief executive Richard Segal, even though profits rose 49%.
Shares slipped back following a positive start to stand 3.25p lower at 127.25p.
The day’s biggest blue chip risers were RBS up 50p to 1909p, BAT up 31p to 1359p, HBOS 6p higher at 1062p and Marks & Spencer 2.5p ahead at 518.5p.
The heaviest fallers were Alliance & Leicester off 56p to 1069p, Reuters down 18p to 380p, Vodafone 4.75p lower at 109p and BAE Systems down 14.75p to 420p.