Footsie's positive run ends

Poor sentiment towards banks and oil companies today ended a six-day run of gains by the FTSE 100 Index.

The Footsie ended the session 16.8 points down at 5315.5 after investors pulled out of oil stocks and reacted coolly to interim results from the Royal Bank of Scotland.

The index also failed to find any upside from the Bank of England’s move to lower interest rates to 4.5%, which traders had already factored into the market.

An afternoon rise in the price of US light crude to nearly 62 US dollars a barrel came too late to lift BP, Royal Dutch Shell and BG Group, which declined after yesterday’s better-than-expected US oil stockpile data.

BP lost a penny to 642p while Shell B shares were down 13p to 1851p and BG Group was off 2p at 488.25p.

However, the rising oil price helped to slash the Dow Jones Industrial Average by 65 points shortly after London’s close.

US retailers such as Nordstrom led the decline after the industry posted smaller-than-expected sales gains in July.

Nervousness ahead of tomorrow’s US consumer confidence figures also had a negative impact on the market, analysts said.

Royal Bank of Scotland was one of the heaviest losers despite posting a 14% hike in half-year profits to £3.69 billion.

Analysts said the results were below the consensus forecast and expressed concern at the performance of its UK retail division, sending shares 4% lower, off 75p to 1628p.

A string of other banks followed RBS lower, with Barclays weakening 3p to 559p as investors awaited its results tomorrow. Lloyds TSB slipped 2.5p to 485.5p but HBOS bucked the trend to lift 8p to 887p.

Amvescap joined the banks and oil majors in pulling the Footsie down after Canadian fund manager CI Financial withdrew its unsolicited offer for the investment group. Shares were at the top of the fallers, slipping 11% or 46.75p to 369.25p.

In contrast, ICI and consumer products group Unilever proved to be the biggest risers, gaining nearly 10% and 4% respectively as the City picked up on signs of resilience in the face of tough conditions.

ICI lifted 26.25p to 296.5p as it stuck by guidance for a satisfactory year and said it had experienced some improvement in trading towards the end of its second quarter.

Unilever followed it after posting lower profits, but saying it had stabilised market share. Shares were 21p higher at 572p.

Outside the top flight, car dealer Pendragon was also in the black after increased efficiencies its acquisition of CD Bramall last year helped post a 19% hike in first half profits. Shares advanced 11% or 33p to 328p.

Biggest risers were ICI up 26.25p to 296.5p, Unilever gaining 21p to 572p, BSkyB climbing 18p to 562p and International Power lifting 4.75p to 220.5p.

Largest fallers included Amvescap down 46.75p to 369.25p, Royal Bank of Scotland off 75p to 1628p, Smiths Group losing 21.5p to 903.5p and Smith & Nephew retreating 12.5p to 532p.