FTSE down

The FTSE 100 Index drifted downwards today with little momentum for trading in the approach to the Christmas break.

The blue-chip index lost 37.8 points to 4249.2 at the beginning of a shortened trading week with sparse newsflow in London to drive stocks.

But sentiment was weakened by a profit warning from Japanese car giant Toyota and Wall Street’s Dow Jones Industrial Average took early losses on more downbeat corporate news, hitting the Footsie late in the session.

Oil majors had previously helped the index keep close to its opening mark, but gave back their gains as crude prices slid on concerns over falling demand.

Banks had a mixed day. HBOS was up 0.9p to 65.1p, and HSBC gained ground for much of the session after heavy falls last week on rumours of fundraising plans, before eventually finishing 0.5p lower at 612.25p.

Elsewhere in the sector, Lloyds TSB shed 11.6p to 123p and Barclays – said to be planning to spin off its private equity operations – shed 3.2p to 145.1p.

Crude’s fall to just above 41 dollars a barrel meanwhile took the wind out of the sails of BP and Royal Dutch Shell. The pair fell 3p to 502p and 3p to 1724p respectively after earlier gains.

But prospector Cairn Energy climbed the leaders’ board after it announced an oil and gas discovery near its existing field in the western state of Rajasthan, bringing the shares down 80p to 1928p.

Other energy stocks in focus included nuclear power firm British Energy, after the European Commission provisionally approved its takeover by French utility giant EDF. EDF must sell two of BE’s power plants under the European conditions, but BE added 1.5p to 771p.

Centrica, set to buy a 25% stake in BE, meanwhile gained 9.5p to 253.5p.

But Argos owner Home Retail Group endured an unhappy return to the top flight today as concerns grow over Christmas trading. The stock was the leading faller - off 30.5p to 204p, or 15%.

Retailers Marks & Spencer and B&Q owner Kingfisher were also under pressure, down 5p to 220.75p and 7.1p to 132.3p respectively.

Rolls-Royce suffered a fall despite its report that it had secured a £258m (€273.8m) Ministry of Defence contract to supply engine support to the UK’s Sea King helicopter fleet. Shares fell 11p to 314.25p.

British Airways shares also fell 0.6p to 170.3p after it announced the order of a fleet of 11 new fuel-efficient aircraft for use on short haul routes, in an order worth around £252m (€267.5m).

But telecoms firms Vodafone featured among the winners, as investors headed for more defensive stocks. Vodafone saw a 3.3p rise to 133.25p and Dairy Milk maker Cadbury was up 17p at 585p.