FTSE on the slide

Global economic concerns hit stocks today and offset strong gains from blue chip retailers on London's leading share index.

Global economic concerns hit stocks today and offset strong gains from blue chip retailers on London's leading share index.

A profits upgrade from Argos and Homebase owner Home Retail Group helped retailers make strong advances.

But the wider FTSE 100 Index slipped into the red - closing down 23.3 points at 5617.3 - as a sharp rise in Chinese inflation raised fears that officials could slam on the economic breaks and dent a global recovery.

The potential impact on growth prospects put a raft of heavyweight mining stocks under pressure, led by Kazakhmys which fell 3% or 49p to 1496p.

Wall Street's Dow Jones Industrial Average also dipped in early trading after mixed jobs data, weighing further on the London market. The pound at least had a better day and crept above 1.50 against the dollar.

The main cheer in an otherwise lacklustre session came from the retail sector. Home Retail made its second increase to guidance in less than three months, causing its shares to rise by 4.2p to 272p.

Analysts said cost cuts and better than expected margins at the Argos business lay behind the upgrade to £290m (€319.1m) for the year to the end of February.

And while Home Retail's sales were under pressure due to the weather, other retailers drew encouragement from the figures as Marks & Spencer lifted 4.6p to 353.7p, Next added 42p to 2020p and B&Q owner Kingfisher rose 7p to 223.7p.

They were joined on the risers board by Thomas Cook after the travel giant's investor day prompted analysts at Panmure Gordon to maintain their positive stance on the blue-chip stock. Shares were 7.7p higher at 248.1p.

Elsewhere, shares in Friends Provident owner Resolution rose 0.1p to 73.6p despite it losing its place in the FTSE 100 Index following the latest reshuffle.

The business, which floated in 2008, will be replaced by Investec, down 9p at 530p. The change is due to take place at the end of this month.

Among companies reporting results, supermarket chain Morrisons failed to benefit after a strong set of full-year figures showed a 21% rise in profits to £767m (€843.9m).

Shares slipped 3% or 8.5p to 295.7p as analysts noted the company's more cautious outlook comments on trading in 2010.

Meanwhile, JD Wetherspoon shares were up 1% or 7p to 512p after it reinstated its dividend in the wake of a 17.5% rise in underlying half-year profits to £36.2m (€39.8m).

Also in the second tier, shares in support services firm Connaught rose 6p to 308.5p, as traders digested reports of potential bid interest from 3i. Connaught denied the rumours later.

Waste disposal group Shanks moved in the opposite direction, down 4.4p to 104p after private equity firm Carlyle confirmed it was no longer interested in bidding for the firm.

The biggest Footsie risers were Petrofac up 39p at 1201p, Kingfisher ahead 7p at 223.7p, Thomas Cook up 7.7p at 248.1p and Standard Life up 6.5p at 214.8p.

The biggest Footsie fallers were Kazakhmys down 49p at 1496p, Fresnillo off 25p at 842p, Morrisons down 8.5p at 295.7p and Smith & Nephew down 18p at 677.5p.

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