FTSE sluggish depite O2 statement

Telecoms stock O2 was the talk of the market today after an upbeat trading statement made it one of the highest blue-chip risers.

The mobile giant cheered investors by raising its guidance for UK revenues and saying growth in its German and Irish businesses had also continued over the summer.

However, the mood in the wider market was more sombre with the FTSE 100 Index closing 5.8 points lower at 5447.3.

The top flight made progress earlier in the session but showed a reluctance to edge further above last night’s four-year high.

One trader said a sharp decline in US consumer confidence unsettled markets on both sides of the Atlantic. By the close of trading in London, the Dow Jones Industrial Average stood around 15 points lower.

Back in London, O2 advanced 2.5p to 155.5p, despite bid speculation having inflated its share price over the past weeks.

News that it was attracting customers from rival networks depressed shares in Vodafone, the UK’s biggest mobile phone group, which lost 0.25p to 148.5p. In the FTSE 250 Index, Virgin Mobile was unchanged at 275p.

Oil giants BP and Royal Dutch Shell also featured among the risers, up 6.5p and 2p at 669.5p and 1915p respectively as the cost of a barrel of oil hovered just below the 66 US dollars mark in New York.

But they were all beaten to the top by pharmacy group Alliance UniChem, up more than 3% or 29.5p at 870p, amid speculation venture capitalists may be looking at a possible bid for the company.

British American Tobacco was among those dragging the Footsie lower as the recent rally by cigarette makers ran out of puff. BAT dropped 28p to 1177p, Imperial Tobacco fell 3p to 1588p and Gallaher faded 7p to 871p.

Elsewhere, computer games retailer Game weakened 2p to 84.5p after seeing first-half losses widen. It also suffered problems in replenishing stocks of the new Sony PSP console.

Publisher Emap was in the doldrums, losing almost 2% or 13p to 809p, despite saying in an update ahead of its interim results that it was on track to meet market expectations. It reported a strong performance by magazines Closer, Heat and Zoo, but detailed a weaker showing by Smash Hits and automotive titles such as Max Power.

Pilkington was also downbeat as investors used a trading update, which confirmed it was on course to meet hopes for its annual results, to bank profits. Shares in the glass maker fell almost 3% or 3.75p to 140.25p.

News that Iron Bru-to-Tizer company AG Barr lifted underlying half-year profits despite a “sluggish” market for the carbonated drinks sector failed to inspire investors. Its shares dipped 23p to 969p.

The highest Footsie risers today were Alliance UniChem up 29.5p at 870p, Compass rising 4.5p to 232.75p, O2 up 2.5p at 155.5p and Centrica rising 3p to 248.25p.

The heaviest fallers were British American Tobacco down 28p to 1177p, Enterprise Inns falling 18p to 831.5p, Smith & Nephew off 9.5p at 486.5p and Anglo American down 31p at 1642p.