London shares head south again

Higher oil prices and a poor start to the second quarter earnings season in the United States ensured London shares were heading south again today.

The FTSE 100 Index had its first positive showing in eight sessions yesterday but was back in the red by mid-morning – down 14.7 points at 4366.4.

The mood was not helped by a renewed surge in oil prices as the price of US light crude rose to more than 40 US dollars a barrel on the back of strong demand and renewed fears of further terror attacks in the United States.

As a result, energy stocks were among the few companies to make progress today with BP climbing 4.5p to 491.5p and Shell up 3.25p at 401.75p.

In New York, investors were fretting about earnings amid disappointment at official sales figures and outlook statements from companies including Yahoo.

Marks & Spencer was again making the running in the Footsie, sitting on top of the risers with a gain of almost 3% – up 10.25p to 374p – as reports suggested investors could turn up the pressure on M&S to start talks with Philip Green.

A range of sectors were in negative territory with banks among those most affected. Abbey National gave back some of its recent gains to stand 10p lower at 490p while Barclays slipped 3.5p to 456.5p.

Brewer and pubs group Greene King was second in the FTSE 250 risers, frothing up 3% or 32.5p to 1093p after saying it was buying the Laurel Pub Company’s portfolio of managed houses for £654m (€977.3m).

But retailer JJB Sports was a heavy faller, dipping 6% or 16.75p to 257.25p after it said a rise in sales of replica football kits came at the expense of other parts of the business, with non-replica clothing down 15% on a year earlier.