Footsie down as oil stocks suffer

The four-day winning streak of the FTSE 100 Index came to an end today following a weak performance by oil stocks and further losses on Wall Street.

Investors used a fall in the price of US light crude to under 53 US dollars a barrel as an opportunity to bank profits in oil giants BP and Shell, contributing to the Footsie easing 10.4 points to 4973.2 by the close.

Shell weakened 2.5p to 489p while rival BP fell 4.5p to 560p and BG Group weakened 3.5p to 428.5p. In the second tier, Cairn Energy was down 16p to 1200p.

Traders had hoped US stocks would bounce back today and spark the Footsie into life, but this failed to materialise as the Dow Jones Industrial Average eased 10 points early on.

The unexpected fall continued the rocky end to last week when bad news from car maker Ford and Asda owner Wal-Mart damaged sentiment. Ford shares fell to their lowest level in more than a year on a warning that it was unlikely to meet its profits goals.

Miners were weighing on the London market today as their recent rally petered out. BHP Billiton faded 13p to 716.5p, while Antofagasta lost 17p to 1263p and Rio Tinto was off 14p to 1721p.

Royal Bank of Scotland was the fifth heaviest faller after it was reported to be in talks to acquire a stake of up to 20% in Bank of China. RBS weakened nearly 2% or 29p to 1670p.

The latest set of traffic figures from airports group BAA also failed to excite investors, with the stock slipping 1.5p to 594.5p.

But buyers were in evidence at Tesco ahead of the release of its annual results tomorrow which are expected to show that the supermarket giant has grown profits to more than £2 billion.

Shares in Tesco rose 1.75p to 318.75p, although another retailer due to update the market tomorrow – Marks & Spencer – did not fare as well, declining 2.25p to 341p.

Elsewhere, telecoms group Business Serve advanced more than 9% or 7p to 81.5p after announcing a venture with Taiwanese firm Zyxel Communications to launch a gadget that will help to cut the cost of telephone calls.

The brewing and pubs industry was in the spotlight after an announcement from Wolverhampton & Dudley Breweries that it was in talks to take over Cumbrian brewer and pub operator Jennings Brothers.

Jennings shares were catapulted 27% or 88.5p higher to 413.5p but the deal did relatively little for Wolves, which rose 1% or 11p to 1141p.

Top-flight pubs group Enterprise Inns gained 4.5p to 790.5p and beer maker SAB Miller frothed up 1.5p to 825p.

The highest Footsie risers today were Boots up 14.5p to 649p, Yell Group rising 6.75p to 420p, William Hill up 8.5p to 575.5p and ITV up 1.75p to 128.25p.

The heaviest fallers were ICI down 5.25p to 272.25p, Carnival off 53p to 2865p, BAE Systems down 5p to 270.75p and BHP Billiton off 13p to 716.5p.