Hopes of strong Footsie close dashed

Hopes of another strong close for London’s FTSE 100 Index were hit today by a late sell off.

The Footsie had been well placed for much of the session but closed just 6.1 points stronger at 4223.5 in a disappointing end to the day.

The lacklustre finish came despite a healthy opening to business on Wall Street and a number of solid economic and corporate announcements.

Highlights included a smaller-than-expected drop in UK retail sales, while a CBI study offered a glimmer of hope to manufacturers with order books in July at their best level for nine months.

Specialist lender Cattles provided further encouragement to the financial sector by reporting strong half-year profits growth.

With sentiment among banks already strong, HBOS lifted 11p to 728p, Abbey National rose 6.25p to 551p and HSBC added 11p to 809p.

But the late sell-off upset the progress of Lloyds TSB, unchanged at 433p, while Barclays was off 1.75p at 476.5p.

The insurers proved more resilient with Prudential up 9p at 443p, Royal & Sun Alliance ahead 3p at 153.5p and Aviva 5.25p stronger at 529.25p.

And Cattles found itself near the top of the FTSE 250 Index risers board after posting a 30% rise in half-year pre-tax profits and forecasting a strong 2003. Shares rose 23.5p to 350p.

Back in the Footsie, drinks company Allied Domecq topped the leaderboard amid speculation that it could be the subject of bid interest in the US. Shares gained 3%, up 13.25p at 395p, by the close.

But telecom stocks were under pressure following the release of interim figures and subscriber numbers from 3 owner Hutchison Whampoa.

With 155,000 3G users in the UK, the performance left the sector underwhelmed as Vodafone slipped 1.75p to 119.75p and mmO2 eased 1.25p to 55p.

Vodafone’s share price also took into account the mobile phone giant’s sale of its stake in the Japan Telecom fixed-line operation for £1.4 billion.

Elsewhere, the proposed merger of support services pair Parkman and Mouchel attracted shareholder support.

The tie-up, which should create a business with an order book worth more than £700 million, lifted Parkman 19p to 255p, while Mouchel added 27.5p to 208.5p, a gain of 15%.

There was also a rise of 8% for Lancashire conservatory specialist Ultraframe as traders looked for encouragement in full-year numbers later this year. The stock closed 23.5p higher at 313.5p to top the FTSE 250 risers board.

But technology group Psion succumbed to profit taking following a strong run in recent days.

The stock fell 3.5p to 80p – a drop of 4% – despite strong half-year figures from Symbian, the mobile phone technology specialist in which Psion has a 25% stake.

The biggest Footsie risers were Allied Domecq up 13.25p at 395p, ICI ahead 5.25p at 190.25p, Rolls-Royce up 4p at 155.5p, Reckitt Benckiser ahead 28p at 1151p.

The biggest fallers were AB Foods down 14.5p at 533p, AstraZeneca off 61p at 2441p, mmO2 down 1.25p at 55p and Dixons off 2.75p at 138.75p.