FTSE edges forward

Investors stayed on the sidelines today ahead of tomorrow’s decision on interest rates in the United States.

Investors stayed on the sidelines today ahead of tomorrow’s decision on interest rates in the United States.

The FTSE 100 Index closed 2.1 points higher at 6242, reflecting general uncertainty about borrowing costs on both sides of Atlantic, as well as a session of fluctuating fortunes for mining stocks.

The sector was deep in negative territory for most of the day, but recovered sufficiently to leave most of the heavyweights up by 1% or more.

Other notable rises saw BA gain a further 2% amid continued relief that it had avoided the threatened cabin crew strike.

The airline’s shares were up 9p to 551p, even though the deal with unions came too late to prevent many customers from changing their travel plans.

Power station group Drax group also featured on the top flight risers board, ahead 15p to 690.5p, making up for some of the losses seen yesterday and at the end of last week after a downgrade from Citigroup and a drop in wholesale gas prices took its toll on the group’s share price.

Cadbury Schweppes performed well, ahead 8p to 576.5p, riding on the back of bid speculation circulating last week. ITV meanwhile jumped by more than 1% – up 1.5p at 108.3p – after Goldman Sachs said it saw upside to its forecasts. It pointed out that the outlook was better than expected for both the first quarter and the full year.

Among the mining stocks, Vedanta Resources led the way with a rise of 32p to 1162p and Rio Tinto followed with a gain of 52p to 2727p. It had been a different story earlier as softer metal prices and a weaker-than-expected performance on zinc output from Kazakhmys caused shares to slide.

Kazakhmys remained in negative territory with a drop of 10p to 1040p.

Vodafone was one of the day’s biggest fallers after yesterday’s disappointing update from Deutsche Telekom. Vodafone was down 2p, or 1%, at 147p.

In the second tier, beleaguered retailer Woolworths rose 1.5p to 33.75p as it said its wholesale arm had secured a contract with Virgin Retail, which operates 127 stores in the UK and Ireland.

Analysts raised their profits forecasts after estimating that the three-year deal will add around £200m (€300m) to the group’s turnover each year. The deal replaces work due to be lost when Tesco ends its contract later this year.

Carpetright moved in the opposite direction, down more than 2% as the retailer reported a weaker trend for recent sales. While the company said the drop was due to tougher comparisons with a year earlier, shares still dipped 32p to 1233p.

The biggest Footsie risers were Vedanta Resources up 32p at 1162p, Drax ahead 15p at 690.5p, Rio Tinto up 52p at 2727p and Smith & Nephew ahead 10.5p at 577.75p.

The biggest fallers were Man Group down 8.5p at 537.5p, Royal & Sun Alliance off 2.25p at 163.25p, Vodafone down 2p at 147p, Slough Estates off 9p at 747.5p.

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