Hopes of a sustained rally by London shares disappeared today as concerns over the strength of the United States economy returned to haunt investors.
The FTSE 100 Index faced a wave of afternoon selling as US unemployment and consumer confidence data failed to impress on both sides of the Atlantic.
With a string of downbeat results from blue-chip firms such as British Land and Tomkins also weakening sentiment, the Footsie closed 23 points lower at 4719.4.
Traders were pessimistic about the chances of an improved performance tomorrow as US markets are closed for the Thanksgiving holiday.
In London, one of the session’s biggest stories came in the second tier after Luton airport owner TBI agreed a £551 million takeover by a Spanish infrastructure group.
TBI, which has seen its share price surge in recent weeks following continued bid speculation, edged close to the 92.25p offer price with a gain of 2% or 2p to 91.25p.
In the top flight, Tesco featured on the Footsie risers board after benefiting from a positive broker note. The supermarket giant gained 2p to 298p and outflanked rival Sainsbury’s, which fell 4.5p to 263.25p.
Investors were betting on improvement in the leisure sector, with bookmakers William Hill rising 7p to 525p and Ladbrokes owner Hilton Group ahead by 4.25p at 264.25p.
Logistics group Exel was also doing well – up 3p at 734p – after announcing that current trading had been in line with expectations.
Car parts maker Tomkins said the same thing but saw shares head in the opposite direction, falling 6% or 16p to 252p as the weakness of the US dollar sent third-quarter profits lower.
British Land beat expectations with an 8.6% rise in the net asset value of its property portfolio and underlying profits, but could not tempt investors to its shares which fell 22p to 780p.
Mobile phone group Vodafone lost some of its recent strength, with a 1.25p fall to 143p after going ex-dividend – meaning the stocks no longer carry the right to the latest dividend payment.
News that struggling retailer WH Smith has appointed Severn Trent chief executive Robert Walker as chairman failed to lift its share price from its opening mark of 309p.
In the FTSE 250 Index, food equipment group Enodis continued to benefit from its strong full-year results of yesterday as shares surged 9% or 8.5p to 102p. Analysts said the group was also a potential bid target in a fragmented industry.
In contrast, water and waste group AWG lost 9p to 726p despite saying its infrastructure arm had returned to the black after reaping the rewards of an overhaul.
The biggest Footsie risers were Hilton Group, up 4.25p to 264.25p, British Airways ahead 3.5p to 219.25p, Carnival up 43p to 2962p and William Hill ahead 7p at 525p.
The biggest fallers were Tomkins, down 16p at 252p, Northern Rock off 20p at 705p, British Land down 22p at 780p and AstraZeneca off 46p at 2099p.