FTSE falls below 5400

The London market retreated below the 5400 threshold today as telecoms stocks and miners were hit by a wave of profit-taking.

Fewer than one-fifth of the FTSE 100 Index made it into positive territory despite the buzz of fresh takeover activity and boosts for the retail sector.

By the close of play in London, the Footsie had lost 46.7 points to stand at 5369.7 as sentiment also suffered from its counterpart on Wall Street sliding into the red.

Analysts said miners had suffered from investors locking in profits made during a recent rally that sent many in the sector to all-time highs.

Chilean group Antofagasta was the heaviest mining faller, down 27p at 1498p as investors lost the right to the latest dividend payment, while Xstrata eased 13p to 1428p.

There was little joy in the telecoms sector as mobile phone firms O2 and Vodafone featured prominently among the Footsie fallers, off 4.5p and 3.5p at 152p and 146.75p respectively.

Elsewhere in the retail sector, stocks were buoyed by better-than-expected updates from high street chain Woolworths and Zara owner Inditex in Spain.

Marks & Spencer and Next all made gains as Woolies said same-store sales fell by 1.7% in the last eight weeks compared with a previous 4.4% decline and Inditex announced a 20% rise in sales to €2.82bn.

M&S was up 8.75p to 354p and Next cheered 7p to 1420p, while Boots lifted 4p to 619.5p amid rumours that it had sold its Nurofen-to-Clearasil healthcare divisions for more than expected.

Woolies, which is a FTSE 250 Index stock, was up 0.5p to 34.25p.

Camera specialist Jessops fared even better, surging 12% or 9.5p to 86.5p, as it promised results in line with expectations and reported a recovery from the trading slump it experienced earlier in the calendar year.

The latest bid speculation was provided by media and marketing specialist Aegis after it confirmed it had received an approach from a mystery suitor worth 140p a share, or £1.57bn (€2.3bn). Shares rose above the bid price, up 24.5p to 145p, as analysts appeared to eye an improved offer.

Elsewhere music management business Sanctuary lost more than 17% of its value, down 1.71p at 8.29p, as it once more shocked investors by warning it would make an underlying loss following a deepening of its trading woes.

Parcels group Business Post also suffered heavy losses, slumping by more than 27% or 176p to 475p after warning annual profits would be “substantially” lower than last year. It said deteriorating economic conditions had led to a sharp decline in trading at its core business-to-business parcel delivery arm.

The highest Footsie risers today were Marks & Spencer up 8.75p to 354p, BG Group adding 7p to 539.5p, BOC Group up 10p to 1144p and International Power adding 1.75p to 244.75p.

The heaviest fallers were PartyGaming down 4.5p to 105.25p, O2 off 4.5p to 152p, ICI losing 8.5p to 293.25p and Carnival down 80p to 2885p.