FTSE falls below 6600 barrier

The London market plunged below the 6600 barrier today as investor nerves were shaken by economic fears in the US and China.

The London market plunged below the 6600 barrier today as investor nerves were shaken by economic fears in the US and China.

The FTSE 100 Index closed 51 points down at 6565.4, mirroring losses seen in America after data revealed that house prices fell by 11% last month - their fastest ever decline.

Concerns in the US compounded investor alarm over possible meltdown in China after former US Federal Reserve chairman Alan Greenspan forecast an eventual "dramatic contraction" in Chinese markets.

Expectations of rising factory gate prices also weighed on the market, fuelling speculation of a further interest rate rise on top of the four seen since last August.

Insurer Royal & Sun Alliance was among the session's biggest fallers after its plans to buy up the remaining shares in Danish life insurer Codan sent the stock down 6%, or 9.7p, to 160p.

The fears over China's economy saw miners litter the substantial list of share fallers, with Vedanta off 40p at 1465p, or 3%, Lonmin off 129p at 3856p and Xstrata down 69p at 2756p.

Supermarket chain Morrisons also slipped 6.75p to 313.75p as the company unveiled modest like-for-like sales growth of 4% in the past 15 weeks and ruled out a sale of its property portfolio, which disappointed investors keen to see potential value unlocked.

Telecoms firm Cable & Wireless topped the Footsie risers after the group announced a sharp rise in pre-tax profits to £249 million and progress in the turnaround of its UK operation, lifting its shares 5.2p higher to 191.9p - a rise of 3%.

Vodafone followed close behind, up 2.1p at 152p, or 1%, amid positive broker forecasts for the group's full year results out next week.

The mobile phone giant is set to reveal a "robust performance" in its key markets, according to Lehman Brothers.

Meanwhile credit checking group Experian gained 11.5p to 610.5p after a broker upgrade following healthy full-year results in the previous session, and sugar and starch group Tate & Lyle moved 5.5p ahead at 610.5p as the firm made a modest recovery from yesterday's losses.

A broker downgrade from Credit Suisse saw pharmaceuticals giant GlaxoSmithKline head in the opposite direction - down 11p at 1333p. Credit Suisse said the commercial prospects of Avandia drug have "immediately dimmed" following the troubles this week, with doctors and patients predicted to be much more reluctant to start using the treatment.

In the second tier, fashion retailer Burberry lost 4%, or 25p to 667.5p, after its annual results disappointed investors.

Elsewhere, Mothercare was trading 1% higher after its full year figures revealed better-than-expected performances at both its international and UK divisions. The stock was trading up 7.75p at 424.75p.

The biggest Footsie risers were Cable & Wireless ahead 5.2p at 191.9p, Experian up 11.5p 610.5p, Schroders ahead 20p at 1390p and Vodafone up 2.1p at 152p.

The biggest Footsie fallers were Royal & Sun Alliance off 9.7p at 160p, Persimmon down 49p at 1367p, Lonmin down 129p at 3856p and Vedanta Resources down 40p at 1465p.

More in this section

The Business Hub
Newsletter

News and analysis on business, money and jobs from Munster and beyond by our expert team of business writers.

Sign up
Puzzles logo
IE-logo

Puzzles hub

Visit our brain gym where you will find simple and cryptic crosswords, sudoku puzzles and much more. Updated at midnight every day.

Lunchtime
News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up
Revoiced
Newsletter

Our Covid-free newsletter brings together some of the best bits from irishexaminer.com, as chosen by our editor, direct to your inbox every Monday.

Sign up