BT drop keeps market subdued

London shares were subdued today, as the Bank of England's interest rate cut failed to inspire and a nine per cent drop from BT weighed on the market.

By the close of trading, the FTSE-100 Index was off 19.5 points at 6206.1, losing all its earlier gains. The decision by the Bank of England's Monetary Policy Committee to shave 0.25% off interest rates had been anticipated by the market and provoked little reaction.

Corporate results were generally met with a negative response, with BT diving nearly nine per cent after issuing third quarter figures. Analysts pointed to a disappointment on a lack of news about the firm's restructuring plans and concerns about higher interest charges.

Sentiment was also hurt following Wednesday's news from France Telecom that it is cutting the flotation price of mobiles firm Orange. By the close of trading BT was down 60p at 620p.

Chemicals group ICI was another hefty faller, off 7%, down 35p at 491p, after releasing its full-year results, as investors worried about results showing its international business had been affected by slowing demand in the US.

The company also warned the slowing US economy would affect global economic activity this year. Anglo-Swedish biotech group AstraZeneca also saw shares look peaky following its full-year results. The group said it faced a "challenging" couple of years as it began to switch out of its older drugs portfolio into a new generation of products. Its shares were off 41p, at £28.63.

Unilever, which reported its full-year figures, slipped marginally, despite showing a 4% rise in sales of its leading brands over the past year. Shares were off 5p at 531p.

But it was not all bad news and shares in petroleum giant Shell were up 7.50p at 584p as the Anglo-Dutch group reported a record 85% leap in full-year earnings, partly fuelled by higher oil and gas prices.

Jewellery group Signet was up 3%, up 2.25p at 71p after posting a 3% hike in like-for-like sales in the last quarter. Autonomy jumped nearly 7%, up 118p to £19.33, while Spirent rose 24p at 514p.