Footsie fails to recover from early losses

Top flight shares remained in poor shape in London today as investors booked profits after a downbeat session in New York.

Top flight shares remained in poor shape in London today as investors booked profits after a downbeat session in New York.

Although the FTSE 100 Index recovered from an earlier 31-point loss, it was still floundering 23.4 points adrift at 4705.3 by mid-morning.

The Dow Jones Industrial Average dropped 106 points last night as technology stocks dipped sharply despite reasonable updates from IBM, Hewlett Packard and microchip maker Texas Instruments.

Oil stocks were proving a drag on European markets, with BP and Shell both losing ground.

Brewer Scottish & Newcastle rose 1.5p to 432.5p after announcing a deal to run an additional 364 pubs.

Spirit Group is selling the outlets to newly formed Globe Pub Company, which has appointed S&N to run the business.

Investors continued to shun mining stocks after broker Merrill Lynch downgraded the sector yesterday. Rio Tinto topped the Footsie fallers with a 40p loss to 1434p, while BHP Billiton shed 11p to 573p. Antofagasta dropped 21p to 1059p and Xstrata was down 17p at 874p.

International banking group Standard Chartered was off 2% or 20p at 962p after Dresdner Kleinwort Wasserstein downgraded the stock following what it described as a “weak” trading statement.

Transport group Stagecoach topped the FTSE 250 risers with a lift of 8% or 8.25p to 108.5p after the performance of its London bus operation helped it to beat expectations for half-year profits. Rival second flight group National Express followed in its footsteps, picking up 7.5p to 775.5p, while another bus and rail group, Arriva, drove 1.75p ahead to 500.75p.

Utility group Kelda was another riser, up 3.5p at 567p, after its core Yorkshire Water business continued to perform well, offsetting the impact of the weak US dollar on its business across the Atlantic.

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