FTSE falls back due to energy sector blues

The London market caught a chill from weaker energy stocks as the FTSE 100 Index fell back today from last night’s 39-month high.

With BP and Shell both down by more than 1%, the Footsie lost some of its recent shine to reach mid-morning 19.2 points lower at 5240.5.

The slump for the oil heavyweights – BP slipped 11p to 614.5p and Shell declined 8.5p to 540.5p – came after the price of crude oil fell to 57 US dollars a barrel in New York.

The decline had the opposite effect on airlines as British Airways surged 3% or 8.5p to 281p and second-tier rival easyJet added 7.75p to 264.5p.

Among other beneficiaries of the lower oil price, transport group Aviva fell 4p to 650p, BAE Systems cheered 1.75p to 294.25p and second-tier company First Group lifted 4.5p to 337.5p.

Losses by a string of mining companies contributed to the Footsie’s weakness as Rio Tinto fell 30p to 1771p and BHP Billiton lost 9p to 751.5p.

Among companies reporting today, JD Wetherspoon lost hold of gains achieved after it said like-for-like sales were positive in the three weeks to Sunday.

With the year-on-year gain helped by the negative impact of Euro 2004 on the performance 12 months ago, shares later eased to stand 1.75p lower at 270.25p.

Elsewhere, Barratt Developments rose a penny to 715p after posting an update that investors viewed as resilient in the face of the housing market downturn.

But the same downturn had a knock-on effect for Baggeridge Brick, which slumped 13% – off 23p at 159.5p – after warning that it would miss profits expectations for the year to the end of September.

Beleaguered engineering group Jarvis also saw its stock weaken after revealing widening losses. News that trading had improved was not enough to prevent shares falling 8% or 0.63p to 7.25p.