FTSE slumps as Abbey takeover bid ignored

The London market slumped to a new low in 2004 today as investors gave the cold shoulder to a takeover bid for Abbey National.

The FTSE 100 Index succumbed to its lowest level since October last year, down 39.3 points to 4287, as investors voiced discontent about various aspects of Banco Santander Central Hispano’s £8.5bn (€12.8bn) offer.

Traders said concerns included the fact that the bid was partly based on Santander’s own share price, which fell 2.6% today. Shares in Abbey weakened 23p to 557p.

Barclays was also one of the financial sector’s highest fallers after City talk linked it to a counter-bid for Abbey. Shares fell more than 1.5% or 7p to 443p.

The market gloom was compounded by high oil prices, with US light crude moving above $41 dollars a barrel, and fears about interest rate rises on both sides of the Atlantic.

Mobile phone giant Vodafone fell 2.25p to 114p despite saying its customer base had reached 139.2 million in the face of tougher conditions in many of its markets. The news had cheered investors earlier in the session.

Outside the top flight, debt-laden Channel Tunnel operator Eurotunnel slipped 10% – or 2.25p to 20.25p – as it revealed a “worrying” financial position after half-year losses ballooned.

The day’s biggest climbers included Antofagasta, up 12p to 948p, B&B lifting 2.75p to 269.75p, British Land advancing 7p to 700p and BOC rising 6.5p to 902.5p.

Largest fallers included Abbey, down 23p to 557p, Man Group off 50p to 1355p, Sage losing 4.75p to 165.25p and BA retreating 5.75p to 229p.