London shares continue to slide

London shares continued to drift lower today as investors’ eyes turned towards George Bush’s attempts to revive confidence in the US.

The President pledged to ‘‘expose and punish acts of corruption’’ in a speech analysts said was designed to pull US markets out of their malaise.

A brighter start to trading on Wall Street this afternoon helped pull the FTSE 100 Index off its lows by the close of trading in the City.

But as President Bush wrapped up his speech the Footsie still ended the session down 58.4 points at 4542.9.

Accounting concerns and fears over corporate profitability dominated most of the day in London, wiping out a near 35 point gain in the first hour.

President Bush centred on moving corporate accounting out of the shadows and protecting small investors from scandals such as WorldCom and Enron.

Tom Hougaard of financial bookies City Index said: ‘‘It’s too early to tell if the rot will continue or investors are going to start buying again.’’

In London, the heaviest faller was software firm Sage, reflecting heavy falls by tech stocks in the US last night, falling 12¾p to 147¼p.

Mobile phone giant Vodafone also struggled, closing a further 3% down, a drop of 3¼p to 92p while rival mmO2 fell ½p to 46p.

Retailers also drifted lower despite encouraging sales figures from supermarket chain Safeway which reported faster sales growth across its stores.

Concern over the outlook for the chain saw its shares close 2p down at 261p and rival Tesco lost almost 4% or 9¾p to 240¼p.

Elsewhere on the high street, Argos-to-Burberry group GUS slid 28p to 587p, Dixons dropped 4½p to 179½p and Marks & Spencer fell 7p to 363p.

M&S is expected to post a solid set of sales figures for the first quarter tomorrow and analysts will watch for clues on future growth.

There was little corporate news to spark the market and the Sandler report on the UK savings industry weighed on financial shares.

The report called for changes to introduce new, simple and cheap products that require less regulation than current products.

After rallying early on relief proposed measures were not harder, financial stocks drifted lower as fears rose that margins would suffer.

Prudential fell 21½p to 553½p, Aviva slipped 19p to 478p and Royal & Sun Alliance ended the day 4p lower at 237½p.

Among the banks, Lloyds TSB closed up 3½p to 633p and Abbey National rose 2½p to 795p but Barclays fell 10p to 502p and HSBC dropped 6½p to 753p.

Among smaller stocks reporting results today, photo booth operator Photo-Me International fell after a posting a slump in final profits.

The company also warned of more tough times ahead and closed down by more than 18%, a fall of

3¼p to 14¾p.

But it was a better day for plant hire firm Ashtead which rose over 11% after showing signs of an upturn in trading.

Despite posting pre-tax losses of £15.5 million for the year, the group climbed 4½p to 44p.

In the FTSE 100, the highest risers were Xstrata, up 35p to 812p, South African Breweries, up 18p at 530p, Friends Provident, ahead 3½p to 140p and WPP, up 10p to 538p.

The heaviest fallers were Sage, down 12¾p at 147¼p, GUS, off 28p at 587p, Hays, down 6¾p at 142¼p and Six Continents, off 28p at 635p.