The London market dipped into the red today amid jitters on Wall Street and signs of energy market fallout from the conflict between Russia and Georgia.
The FTSE 100 Index had been holding up despite latest inflation figures which showed the biggest monthly rise since records began.
But nervousness in New York after more mortgage-related losses for Wall Street banking giant JP Morgan and the news that BP had shut a pipeline in Georgia as a precaution amid the region’s strife saw the Footsie close down 7.3 points at 5534.5.
The blue-chip index had fallen below the 5500 mark after July’s 4.4% inflation figure was announced.
ITV was the standout stock due to speculation of a takeover approach from Dutch TV firm Endemol. It sent the broadcaster’s shares up 6%, or up 3p at 50.6p.
Oil prices remaining below 114 US dollars a barrel also saw travel and transport firms gain places on the Footsie risers board.
Tour operator TUI Travel rose 4.25p to 239.25 while bus and rail firm FirstGroup gained 2p to 566.5p.
Holiday Inn firm InterContinental Hotels also made good gains, up 3% after half-year figures showed a 21% hike in earnings. News of slowing growth amid the more challenging trading conditions came as no surprise and failed to hold shares back, up 22.5p at 773p.
Retailers were under pressure as disappointing industry sales figures for July highlighted the severity of the sector’s downturn.
Next, Sainsbury’s and Marks & Spencer were among those who suffered after the British Retail Consortium said July sales fell 0.9% year-on-year, despite the dire trading seen amid last year’s turbulent weather.
Next fell 52p to 1080p, while Sainsbury’s dropped 6.25p to 367.25 and M&S shed nearly 3%, or 8p to 296p, amid fears today’s inflation figures have increased the chances of an interest rate rise.
Supermarket Tesco was more resilient, adding 2.7p to 396.8p, after announcing its Indian debut with a wholesale cash-and-carry venture and deal with India’s Tata Group conglomerate.
In the second tier, the rally seen among housebuilders yesterday amid stakebuilding in the sector all but petered out after the inflation data. Taylor Wimpey was flat at 58.5p while Barratt Developments added 1.75p 4.75p to 163p.
Food companies were among the best performers in the FTSE 250 Index risers board, with Northern Foods up 7%, or 4.25p to 65.25p, while Domino’s Pizza was ahead 12.5p to 202.25p.
The Footsie’s four biggest risers were ITV up 3p at 50.6p, British Land up 31.5p to 790.5p, InterContinental Hotels Group up 22.5p to 773p and Drax Group which ended the session up 17.5p to 699p.
The four biggest fallers were London Stock Exchange down 68p to 900p, Standard Chartered down 109p to 1490p, Eurasian Natural Resources down 71.5p to 988.5p and Kazakhmys which ended the day 68p down at 1166p.