FTSE in the red

The London market plunged into the red today weighed down by a poor performance on Wall Street overnight and a heavy fall by Norwich Union owner Aviva.

The London market plunged into the red today weighed down by a poor performance on Wall Street overnight and a heavy fall by Norwich Union owner Aviva.

UK investors spooked by the prospect of rate hikes in the US and growing tensions in the Middle East joined the sell-off and the FTSE 100 Index stood 52.7 points lower at 5807.9 by mid-morning.

The miners led the way down with Kazakhmys 26p lower at 1213p, Antofagasta off 16p to 429.5p and Anglo American down 45p to 2225p.

Norwich Union owner Aviva lost 12p to 701p despite reporting a strong first half trading performance after announcing it is to buy US life insurer AmerUs for $2.9bn (£1.6bn/€2.2bn) in a deal that will boost the UK firm’s presence in the States.

Other insurers also tumbled with Prudential losing 6.5p to 569p and Legal and General off 2.25p to 125.5p.

Bucking the trend, Scottish & Southern Energy gained 4p to 1158p following the news yesterday that it has taken a stake in a £400m (€579m) project to build a power plant capable of serving up to one million homes.

And InterContinental moved up 3.5p to 957.5p after it announced it is to sell seven hotels in Europe for £440m (€637m). The group, which owns the Holiday Inn and Crowne Plaza brands, said it will manage the hotels under 30-year contracts following the sale to Morgan Stanley Real Estate Funds.

Outside the top flight, 13% was wiped off media group Emap’s shares after it warned underlying revenues were being hit by difficult trading conditions. The company said circulation had grown at the weekly titles, such as Grazia, in its UK consumer magazine division but had declined for men’s and car magazines. Shares fell 111p to 726p.

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