Footsie loses ground late on

London’s FTSE 100 Index lost ground late on today after downbeat economic news in the United States upset the market’s earlier calm.

The Footsie closed 27.2 points lower at 4134.1 as the index matched the Dow Jones Industrial Average’s reaction to disappointing consumer data in the US.

Prior to those figures, London’s leading shares had been in lacklustre mood, drifting between positive and negative territory as the lack of corporate news curtailed any buying enthusiasm.

Tesco was the brightest performer among blue-chips despite receiving a grilling from shareholders over executive pay policies.

Ahead of its annual general meeting, the retailer reported UK like-for-like sales growth of 5.8% in its first quarter. That was better than the 4.1% growth achieved during the previous financial year.

Shares in the supermarket giant closed ahead more than 3%, or 6.5p at 211.5p, although it was not all good news for Tesco as only 60% of its shareholders later backed its remuneration report during a hostile annual meeting.

Elsewhere, the good run enjoyed by banking stocks following Royal Bank of Scotland’s upbeat trading statement and its Churchill insurance buy came to an end.

The sector spent much of the session on the front foot before losing ground towards the end of the session.

RBS closed 1p lower at 1735p while Lloyds TSB eased 3p to 447.75p, Abbey National slipped 8.75p to 518.5p and Alliance & Leicester lost 8.5p to 842.5p. Barclays survived the sell-off, rising 2.5p to 463.75p.

Oil stocks also had a negative influence on the market, with BP 7p lower at 439p and Shell falling 5.25p to 420p.

And defence group BAE Systems lost 0.75p to 141.25p, despite issuing a statement saying its performance had been in line with the guidance given at the time of its annual general meeting in April.

Outside the Footsie, furniture retailer MFI posted strong gains, up 13% or 19.75p to 167.75p, after forecasting a 62% lift in sales in the next three years on the back of a fresh look for its stores.

And supermarket group Somerfield continued to show no ill-effect from yesterday’s announcement by entrepreneurs Bob Lovering and Bob Mackenzie that they were ending their takeover interest.

Somerfield shares rose 3% yesterday and added another 3% or 3.25p at 111.5p today.

Discount retailer Matalan, which surged 12% yesterday on the back of takeover speculation, eased 2.25p to 189p after earlier adding 4%.

Meanwhile, the David Beckham transfer saga continued to put Manchester United shares under the spotlight. They rose 3%, or 4.75p at 152p, today.

The biggest Footsie risers were Tesco up 6.5p at 211.5p, Standard Chartered ahead 12p at 762p, Daily Mail & General Trust up 9.25p at 590p and Northern Rock ahead 10.5p at 727.5p.

The biggest fallers were Cable & Wireless down 3.5p at 104.5p, Granada off 2.75p at 83p, Bradford & Bingley down 11p at 345.5p and BT Group off 5.25p at 192.5p.