A glut of earnings news today failed to prevent London shares succumbing to high oil prices and lingering fears of an interest rate hike.
The string of corporate announcements featured plenty of positive news, although not enough to prevent the FTSE 100 Index ending the day in the red, down 16.4 points at 4972.1.
Aerospace and defence group BAE Systems, steel group Corus and pest control firm Rentokil Initial were among the blue-chip firms trying to drive the Footsie forward, with shares in the companies higher by about 1% or more.
But high oil prices dampened the mood, as cold weather kept the cost of a barrel of crude oil above the $50 mark.
Yesterday’s comments by the Bank of England about a possible rate rise “in due course” also continued to cast a shadow over the markets.
Wall Street offered little to buoy the City, with the Dow Jones Industrial Average hovering around its opening mark shortly after London’s close.
On the corporate front, a fresh refinancing deal by steel group Corus propelled its shares to the top of the Footsie, lifting 3% or 1.75p to 58p.
Rentokil Initial was second on the risers board after the struggling firm stuck by the recovery strategy it hopes will deliver rewards later this year. Shares were up 4p at 158.5p, even though profits for 2004 were sharply lower.
Hilton’s shares rose by 2p to 314p after it reported a 41% hike in annual profits to £383.1m (€554.3m) and unveiled plans to return cash to shareholders through hotel sales.
BAE Systems also featured in the Footsie climbers after profits before interest and one-off costs came in at £1.01bn (€1.5bn), compared with £980m (€1.4bn) a year earlier. With the company upbeat about prospects for 2005, shares advanced 3p to 253p.
Despite early gains, energy group Centrica slipped back after announcing a 16% rise in operating profits to £1.23bn (€1.8bn) on the back of higher household bills at British Gas and a jump in gas consumption. Shares fell 3.75p to 237.25p.
The decline was still smaller than the 7% fall suffered by pharmaceuticals group Alliance UniChem after it warned of a slower market. Alliance hit the top of the Footsie fallers, slumping 56p to 720p.
Marks & Spencer was also nearly 2% lower as speculation linking a South African financier to a takeover bid came to an end. Shares were off 6.5p at 360.5p.
The financial sector was in the doldrums, with Royal & Sun Alliance a penny lower at 83.5p after a broker downgrade.
A number of other stocks in the sector were in the red, including Royal Bank of Scotland despite posting record profits of £8.1bn (€11.7bn) and beating forecasts. The stock weakened 24p to 1787p.
The biggest risers were Corus up 1.75p at 58p, Rentokil gaining 4p to 158.5p, Capital adding 8.25p to 369.75p and Sage progressing 4p to 207.5p.
The biggest fallers were Alliance UniChem, down 56p at 720p, Amvescap losing 7.25p to 337p, M&S off 6.5p to 360.5p and Barclays weakening 10p to 573p.