Oil prices hamper Footsie progress

The London market failed to hold on to early gains today as further record oil prices hampered its progress.

By the end of the day FTSE 100 Index stood just 7.4 points higher at 4362.6, despite having lifted some 25 points higher earlier in the session.

The subdued rise was partly due to the cost of crude setting new records and a poor start to trading in New York, where investors were braced for the much anticipated launch of shares in Google.

One trader said that with little economic data due for release ahead of the weekend any further rise in the price of oil could easily erode the gains of recent days.

Retailers were also dragging the Footsie down after data revealed sales slowed for the first time in more than a year.

Figures from the Office for National Statistics showed sales volumes fell 0.4% between June and July, slightly below City expectations, after poor weather hit sales of clothing.

Although analysts said the fall would decrease the chances of back-to-back interest rate hikes, the news took its toll on the retail sector.

In the top flight, high street giant Next weakened 19p to 1481p and Marks & Spencer retreated 1.75p to 348.25p.

Elsewhere, FTSE 250 company JJB Sports was also down as it warned profits would be 20% lower than City hopes after wet weather affected like-for-like sales.

JJB fell 15% or 32.75p to 183.75p, while JD Sports owner John David Group fell 15.5p to 169p, a decline of 8%.

Back in the top flight, those helping to keep the Footsie in the black included a clutch of financial stocks, with Northern Rock up 7p to 702p, Friends Provident adding 1.25p to 130.25p and Royal Bank of Scotland 13p higher at 1515p. However, Barclays was one of the heaviest fallers, losing nearly 2% or 9.5p to 503.5p.

Mining stocks were among the highest climbers, with BHP Billiton 13.25p higher at 530.25p, Antofagasta up 23.5p to 1008.5p and Rio Tinto adding 30p to 1402p.

Fresh record crude prices lifted oil giant Shell 0.75p higher to 396p, although rival BP moved 3.5p lower to 487p.

Gambling-based stocks were benefiting from an upbeat note on the sector from Goldman Sachs. William Hill featured at the top of the Footsie risers board with a gain of more than 4%, or 23p to 539p, and Ladbrokes owner Hilton added 3p to stand at 260.25p.

Elsewhere, Cairn Energy saw its shares fall despite news that it will formally confirm the extent of its reserves next month after an independent assessment of its oil strikes in India. The stock weakened 3p to 1435p.

The highest climbers in the Footsie today were William Hill up 23p to 539p, BHP Billiton adding 13.25p to 530.25p, Antofagasta up 23.5p to 1008.5p and ITV adding 2.25p to 102.5p.

The heaviest fallers were BAE Systems down 5.5p to 204.5p, Man Group off 26p to 1334p, Barclays down 9.5p to 503.5p and BSkyB off 6.5p to 472p.