Hurricane aftermath holds Footsie back

The FTSE 100 Index gave up the chance to set a new three-year high today as investors reeled from probable hurricane damage to a rig owned by oil giant BP.

The FTSE 100 Index gave up the chance to set a new three-year high today as investors reeled from probable hurricane damage to a rig owned by oil giant BP.

Shares in BP fell more 2% or 14.5p to 619.5p as it began to assess the damage caused to its Thunder Horse platform after Hurricane Dennis blazed through the Gulf of Mexico.

With the oil giant accounting for 10% of the Footsie, the extent of its decline meant the index of leading shares closed 25.2 points lower at 5217.2.

Major rival Shell was also lower, easing 6.75p to 542p, as investors also digested the company’s settlement of a claim by US employees following its reserves crisis of last year.

Gains by a mixture of blue-chip sectors helped limit the losses, with telecoms companies among those in positive territory as Vodafone gained 1.5p to 142.5p and O2 cheered 2.25p to 138p.

Marks & Spencer was also upbeat as it benefited from a positive broker note the day before its annual meeting. The stock advanced 1.5p to 358p after JP Morgan forecast a recovery in its sales and earnings.

With few top-flight companies reporting in London, attention focused on companies in the lower tiers.

And the news was not good as updates from Provident Financial, Blacks Leisure and McCarthy & Stone all caused their shares to fall.

Retirement housebuilder McCarthy was off 7p at 560p after it said annual sales could be as much as 10% lower and profits weaker than the mid-point of £140 million forecast by a group of analysts.

A clutch of other housebuilders also moved lower following the update, with Bovis Homes 2% or 10p weaker at 693p, Persimmon off 8p at 788p and Redrow losing 3.75p to 414.75p.

Outdoor retailer Blacks lost 4% or 17.5p to 437.5p after it announced a fall in like-for-like sales and said it was not expecting a quick improvement in trading conditions.

The gloom stretched to Provident Financial, which warned that its Yes Car Credit business could lose as much as £20 million this year. Shares were more than 8% lower, off 63p at 672.5p.

And Branston pickle-to-Typhoo tea group Premier Foods was also in the red as it forecast an improved second half for its grocery business, but said its potato arm was having problems. Shares slipped 3p to 326p.

Shares in set top box maker Pace Micro Technology dropped 0.75p to 61.25p after it unveiled a 37% rise in profits.

One of the biggest risers outside the top flight was tea and coffee retailer Whittard of Chelsea on confirmation that it was the subject of takeover approaches. Shares rose 29% or 27p to 121.5p.

The highest Footsie risers today were Old Mutual up 3.25p to 127.75p, Reckitt Benckiser adding 33p to 1643p, O2 up 2.25p to 138p and Scottish & Newcastle rising 6.5p to 489p.

The heaviest fallers were Man Group falling 54p to 1517p, ITV down 3.25p to 126.75p, BP off 14.5p to 619.5p and Shire Pharmaceuticals down 13.5p to 614.5p.

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