Footsie ends year on a low note
The London market finished the year on a low note today, but still managed to end 2004 above the key 4,800 barrier.
Steel and oil stocks dragged the FTSE 100 Index 5.8 points lower to 4814.3 amid signs of slackening demand for steel in China.
This put an end to a previous seven-day rally of consecutive gains that had pushed the top flight to levels not seen since June 2002.
Volumes were extremely thin as many traders chose to take the week off.
During the past year, the Footsie has risen by nearly 350 points, with most of the gains coming in the final quarter.
However, although the index soared to new 30-month highs at the end of 2004, progress was slow and market watchers say they do not expect a dramatic change in the coming months.
Steel group Corus led the Footsie lower today following media reports that China’s demand for steel was waning, signalling potential extra pressure on metal prices. The stock slipped more than 2%, down 1.25p to 50.5p.
Oil giants BP and Shell also lost ground – down 2.5p and 1.75p to 508p and 444p respectively – as the price of a barrel of Brent crude hovered around the 40 US dollars mark in futures trading.
A warmer winter in the US and stable oil inventories in the last few weeks were factors behind the gradual fall in prices of Brent and US light crude, one analyst said.
A clutch of financial stocks were in the red, led by HSBC with a fall of 6.5p to 879p. It was followed by Legal & General, which weakened half a penny to 110p and Northern Rock, off 2.5p to 781.5p.
With corporate news thin on the ground, the only momentum came from outside the Footsie.
Life sciences group Whatman topped the list of FTSE 250 fallers, down 7% or 17.5p to 232p, after saying 160 job cuts would contribute to one-off costs of £13.8 million – higher than the £10 million first estimated. It also said full-year sales were disappointing at around 3% below expectations.
Shares in AIM-listed oil and gas explorer Black Rock Oil & Gas soared by 43%, or 0.84p to 2.79p, after the group said a well it is drilling in Western Australia could hold more than 20 million barrels of oil, of which the firm would own 7.5%.
Shares in troubled engineering group Jarvis regained recent lost ground to stand 7% higher – up 2p to 30p – after upbeat comments from chief executive Alan Lovell on Wednesday.
Oilfield services group MOS International was unchanged at 0.77p as it sounded an upbeat note despite admitting that its half-year results were “disappointing”.
The highest Footsie risers today were Schroders NV up 11p to 704.5p, Smiths rising 8.5p to 822p, Dixons up 1.5p to 152p and Cairn Energy rising 10p to 1090p.
The heaviest fallers were Corus off 1.25p to 50.5p, British Land down 9.5p to 896p, InterContinental Hotels off 6.5p to 647.5p and HSBC down 6.5p to 879p.
