FTSE eases below 4,000 mark

The FTSE 100 Index eased past the 4000 level today as weak trading took its toll on blue-chip shares.

By lunchtime the top flight was off 36.7 points at 3995.7 and a depressed close to the week looked imminent.

A poor session on Wall Street last night set the tone and traders were predicting another uninspired performance when US markets open later this afternoon.

Yesterday the Dow Jones Industrial Average closed down 1.3% yesterday as US markets fell back for a fifth day.

Then trading was dented by disappointing retail sales and concerns about the future of United Airlines.

Alex Scott, equities analyst at Seven Investment Management, said: “There is not much going on out there.

“Wall Street is putting pressure on stocks, but payroll data later on today (from the US) could give us a bit more direction.”

Financial stocks were weighing on the market as they continued a bad run following disappointing updates from Lloyds TSB and Barclays earlier in the week.

Lloyds lost 22p at 486.5p to top the FTSE 100 fallers board, Barclays slipped 14.25p at 401.75p and HBOS dropped 15p at 637.5p.

Royal Bank of Scotland, which updates the market on trading next week, was off 21p at 1504p.

Among insurers, Royal & Sun Alliance was 4p lower at 132.75p and Aviva lost 8p at 502p while fund manager Schroders fell back 23.5p to 536.5p.

New economy stocks were also suffering, with mobile phone giant Vodafone giving up early gains to drop 1.75p at 115.75p.

Among media firms, news and information group Reuters was off 9.25p at 206.5p, Financial Times publisher Pearson eased 24.5p at 663p and advertising giant WPP shed 17.5p at 481.25p.

A handful of stocks were gaining ground, however, with water companies United Utilities and Severn Trent adding 4.5p at 613.5p and 19.5p at 639.5p respectively.

In a quiet session for corporate news, announcements were largely restricted to smaller stocks.

House of Fraser put on 12% after it emerged entrepreneur Tom Hunter had made an indicative approach of 85p per share for the department store chain.

The offer has been rebuffed but hopes of a potential deal still buoyed the stock and shares climbed 9.5p to 87.5p.

Engineering group Frith Rixson also surged, up 3p at 25p. The 14% jump came after it received a £50 million takeover approach from private equity firm Carlyle, which is offering 25.75p cash for each share.