FTSE fails to ignite in early trading

The FTSE 100 Index struggled to make headway today after poor data in the United States fuelled worries over the pace of economic recovery.

The FTSE 100 Index struggled to make headway today after poor data in the United States fuelled worries over the pace of economic recovery.

Reports on manufacturing and home sales released on Friday pushed US stocks lower for a third day and triggered a sell-off in Asian markets today. The Nikkei closed more than 2% lower as a sharp strengthening in Asian currencies hurt confidence among the region’s exporters.

The Footsie, which fell back from year highs in subdued trading last week, stood 11.7 points lower at 5070.5 by mid-morning.

Miners were under pressure due to the economic fears, while part-nationalised banking groups Lloyds and RBS also featured on the fallers board.

They suffered amid further speculation about the outcome of a state aid ruling from Neelie Kroes, Europe’s competition chief.

It is thought that Lloyds could lose a sixth of its market share in Britain, while RBS will be told to make cuts on a similar scale, the FT said.

Lloyds fell 3.8p to 99.6p and RBS dropped 1.5p to 50.45p.

The biggest gain in the top flight came from heating and plumbing supplies firm Wolseley, despite posting annual losses of £766m (€830m).

Shares jumped 10% or 134p to 1443p after its profits figure excluding write-downs and restructuring costs came in higher than expected and the company reduced its debt mountain to below £1bn (€1.08bn).

Home Retail Group posted the biggest fall of the session after Credit Suisse downgraded the stock and said growth will depend on internet-only products that require greater marketing, making Argos’s pricing more susceptible to competition. Shares fell 4% or 10.6p to 275.4p.

Other retail fallers included Next, which dropped 29p to 1783p, while DSG International eased 0.8p to 25.9p in the FTSE 250 Index.

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