The FTSE 100 Index saw another volatile day of trading today as it swung between gains and losses after further fears over the health of the US economy spooked investors.
London’s blue-chip share index plummeted in the afternoon after making early gains, but clawed back some of the losses to close 55.5 points down at 6116 following upbeat US manufacturing data late in the day.
Fresh comments over a potential US recession from former Federal Reserve chairman Alan Greenspan, one of the triggers of the market turmoil on Tuesday, had sent traders scurrying to sell earlier in the day as confidence evaporated.
The Footsie had moved into positive territory on the back of strong corporate results today, up 59.1 points at one stage.
The early sentiment was helped by healthy results from Royal Bank of Scotland.
The bank unveiled annual profits ahead of expectations at £9.19bn (€13.7bn), up from £7.94bn (€11.8bn) a year earlier, and reminded investors that it was one of only five FTSE 100 Index companies to have grown profits in each of the last 10 years.
The judder in the market saw RBS give back some of its early gains but the firm still sat on top of the leaders’ board with a gain of 3%, or 60p to 2069p.
There was also a gain of more than 2% for Sainsbury, even though a potential merger with Marks & Spencer was ruled out by the department store chain last night.
Analysts suggested that the interest of M&S may hasten private-equity plans to bid for the supermarket chain. Sainsbury shares were up 11.25p at 522.5p, while M&S shares were down 8p at 667p.
British American Tobacco was 24p higher at 1573p, as news of a £750m (€1.1bn) share buyback cheered investors. The maker of Dunhill cigarettes posted annual profits of £2.79bn (€4.1bn), a rise of 7%.
Associated British Foods, the parent of fashion retailer Primark, joined BAT as one of the day’s biggest share risers, with shares up 8p at 833p, while shares in fashion group Next also enjoyed a 10p rise to 2052p.
Norwich Union owner Aviva struggled as analysts expressed disappointment at the performance of its life business in today’s 12% rise in operating profits to £3.25bn (€4.8bn).
Shares were down 38p at 780p after operating profits missed analyst expectations, which had forecast earnings of £3.31bn (€4.9bn). A dip in margins in its life and pensions arm also knocked investor confidence, placing the group at the head of the FTSE 100 fallers’ board.
Mining stocks, which have felt the brunt of the Footsie sell-off this week, suffered again today.
Lonmin was down 2%, or 63p, to 3063p, Xstrata off 55p at 2340p and Kazakhmys down 24p at 1077p.
Elsewhere, camera retailer Jessops extended previous losses after it issued a profits warning yesterday as digital camera sales continued to decline. Shares were 30% once again, or 22.25p, down to 52.5p, after already closing down 30% yesterday.
The biggest Footsie risers were Royal Bank of Scotland up 60p at 2069p, Sainsbury up 11.25p at 522.5p, British American Tobacco up 24p at 1573p and DSG International up 2.5p at 173.5p.
The biggest Footsie fallers were Aviva off 38p at 780p, Standard Chartered down 34p at 1394p, Xstrata off 55p at 2340p and Prudential down 15p at 658.5p.