Northern Rock leads FTSE into red

Beleaguered Northern Rock led the London market into the red today after would-be rescuers came forward with cut-price salvage plans.

Beleaguered Northern Rock led the London market into the red today after would-be rescuers came forward with cut-price salvage plans.

The lender fell 16% today after the lender said the proposals received so far were “materially below” its current value.

Northern Rock was 21.6p lower at 111p as the FTSE 100 Index lost early momentum to slip 18.3 points to 6272.9 by mid-morning.

There were more jitters over sub-prime mortgage losses after Swiss Re revealed losses of more than £400m (€561m), while Northern Rock’s woes impacted fellow mortgage lender Alliance & Leicester, 17p off at 590p.

Elsewhere, Barclays was 9.5p down at 499.5p, while Royal Bank of Scotland slipped 7.75p to 418.75p.

It was also a bad day for the property sector after downbeat sentiment over falling values. British Land slipped 5%, or 45.5p to 844p, Land Securities retreated 62p to 1407p and Hammerson fell 33p to 941p.

Lower commodities prices, meanwhile dragged down the miners, with Antofagasta off 22p at 690p and Xstrata down 100p to 3181p.

The biggest improvement of the session came from Asian facing bank Standard Chartered, which gained 52p, or 3%, to 1716p after reports of Chinese interest in Singaporean investment fund Temasek’s stake in the business.

Other risers included broadcaster ITV, up 1.5p to 87.5p following a broker upgrade, while Royal Dutch Shell gained 20p to 1943p as oil prices moved higher.

Housebuilders were unable to sustain early momentum after a trading update from Barratt Developments. The firm briefly topped the leaders board with a 4% rise but later slipped back 8.75p to 495.75p – despite expecting margins in line with previous guidance in tougher market conditions.

Taylor Wimpey also slipped 0.9p to 199.1p, while Persimmon fell 7.5p to 820.5p.

In the FTSE 250 Index exploration company Burren Energy slumped 16%, or 184p, to 1004p after it said Italian energy company Eni was no longer interested in a takeover of the firm.

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