Footsie continues to struggle

The FTSE 100 Index was struggling to avoid its ninth successive fall today as banking stocks continued to suffer.

Despite a bright start, concerns over the Iraqi situation and corporate profitability dominated investors’ minds.

And by lunchtime the Footsie was up 10.6 points at 3688.6 after climbing by nearly 44 points in early trading.

Analysts had forecast a slight rally by the London market today despite further falls on Wall Street last night.

But another negative close for the Footsie would mark the first time it has ever ended down nine days in a row.

Martin Dobson, head trader at NatWest Stockbrokers, said much would depend on Wall Street’s performance later today.

He added: “We started off well but the gains have slowly eroded away. There’s just not a lot to get excited about.”

Abbey National topped the fallers’ board among blue-chip stocks after a broker downgrade from UBS Warburg.

The bank fell 6%, or 29p to 436.5p and a handful of its rivals followed suit with HBOS off 4.5p at 570p. Royal Bank of Scotland was also down 10p at 1332p while Alliance & Leicester dropped 1.5p to 716.5p.

It was a slightly better day for the fragile insurance sector after strong new business figures from Prudential.

The Pru’s full-year insurance sales came in at the top end of forecasts and its shares rose 14p to 381.5p.

Legal & General was also up, climbing 2.75p to 217p, Aviva rose 10p to 394.5p and Old Mutual was ahead 1.25p at 82.75p.

Elsewhere in the top flight telecoms stocks continued to hold up following yesterday’s proposed cuts to connection charges.

Mobile phone giant Vodafone was up 3p at 121p while the former BT business mmO2 was 0.75p better off at 50.75p.

And retailers were to the fore after shock government figures showed high street sales growth was 1.1% last month.

The jump stunned analysts given anecdotal evidence of a slowdown in consumer spending over Christmas.

Marks & Spencer rose 6.5p to 303.25p, Next was up 4.5p at 779p and Argos-owner GUS edged ahead 3.5p to 505p.

Among smaller stocks, software group Misys jumped 12%, or 20.25p to 192.75p, after reporting half-year figures in line with expectations.

But Manchester-based catalogue retailer N Brown dived 24%, off 31.5p to 98.5p, after warning that pre-tax profits for the year would fall 5% short of the previous year.