FTSE down in early trading

Retail stocks saw a second day of turbulence today as sentiment remained weak in the aftermath of yesterday’s dividend cut from Marks & Spencer.

Argos owner Homebase was the sector’s biggest faller in the top flight, down 10.75p to 241p, while M&S lost another 10p to 301.75p and Currys owner DSG International slipped 3.5p to 24.25p in the second tier.

The rest of the London market struggled for direction – the FTSE 100 Index was down 23.7 points to 4458.6 by mid-morning – after downbeat data from the world’s two largest economies.

Wall Street’s Dow Jones Industrial Average was down overnight after gloomy US housebuilding figures, while data also showed Japan’s economy shrinking at a record pace in the first quarter of 2009.

Shares in part-nationalised Lloyds Banking Group were adjusted lower at the start of trading to allow for the fact that buyers are no longer entitled to take part in its £4bn (€4.5bn) placing. However, the stock stood at 71.5p having fallen below the adjusted price of 76.6p.

Other banks also gave up recent gains, with Barclays down 10p at 284.75p and Royal Bank of Scotland off 1.5p at 41.6p.

They were joined on the way down by supermarket giant Sainsbury’s. Shares lost 14.25p to 331.75p after turning ex-dividend, meaning investors will no longer get the latest payout.

Among the risers, oil prices at around 60 dollars a barrel helped BG Group and Royal Dutch Shell advance 13p to 1103p and 37p to 1674p respectively. BP rose 4.75p to 514p.

In the FTSE 250, soft drinks firm Britvic fizzed 12% higher or 32p to 300.75p after a 16% rise in half-year profits and encouraging noises about “modest improvements” in the market.

Mothercare proved the exception in the retail sector after investors warmed to a 12.4% rise in annual profits. Shares were 11.75p higher at 427.75p.