FTSE 100 close: Footsie gets retail jitters

 

The FTSE 100 index was in negative territory today as retail stocks endured a second day of turbulent trading.

Toyota factory

Production line: Markets will look to industrial data today.

Yesterday's dividend cut from M&S continued to send shudders through the sector, hitting the likes of Argos owner Homebase in the top flight and Currys owner DSG International in the FTSE 250.

The FTSE 100 struggled for direction, down 13.84 points at 4,468.4 after gloomy data from the Japanese economy which shrank at a record pace in the first quarter of 2009.

US markets were however expected to open higher this afternoon as investors responded positively to capital raising from the Bank of America.

M&S was a prominent faller for the second day in a row as analysts cut their ratings in the wake of yesterday's figures. Shares fell 17.7p to 294p, although Home Retail Group suffered even worse damage, off 10.75p to 241p.

In the second tier, DSG shed 2.75p to 25p, while cycles and car maintenance firm Halfords was 15.50p lower at 319p.

Lloyds Banking Group took a huge knock from the opening of its £4bn share placing and topped the Footsie losers' board with a 6.12p plunge to 70.50p. Shares are djusting for the fact that buyers now are no longer entitled to take part in its heavily discounted rights issue.

Other banks also gave up recent gains, with Barclays down 1.25p at 293.50p and Royal Bank of Scotland off 0.7p at 42.40p.

Supermarket giant J Sainsbury was not far behind by virtue of going ex-dvidend: shares lost 16.75p to 329.25p.

BP was one of the biggest traded shares, oil prices at around $60 helped it gain 3.7p to 513p. BG Group and Royal Dutch Shell also advanced 12p to 1102p and 24p to 1660p respectively.

Shares in the London Stock Exchange were 2p up at 698p after it reported the cost of its takeover of Borsa Italiana.

Despite revenues rising 23% to £671.4m, it reported a loss for the full year of £338mm - after a profit of £168.3m in the previous year - as it absorbed losses and charges relating to the Borsa takeover.

Yell saw a substantial chunk of its shares traded down 1p down at 44p, after it said annual revenues from its UK Yellow Pages printed directories slumped nearly 11% as a result of the economic turmoil.

The decline was offset by gains at Yell.com, and underlying earnings for for its UK businesses rose 2.3% to £266.7m, as cost savings kicked in.

Across the group, which also publishes the Yellowbook in the United States and Yell Publicidad in Spain, revenues rose 8.1% to £2.4bn and earnings increased 10.4% to £816.1m. However, excluding help from the weaker pound revenues were down 4.6%, including a drop of 12% in the final quarter.

Shares in Mothercare were 7p ahead at 425p after the mother and baby specialist said it had seen benefits 'beyond expectations' from its takeover of Early Learning Centre (ELC).

Mothercare said the integration of the ELC, bought for £85m in June 2007, was almost complete and had brought cost savings.

As it posted a 12.4% hike in annual profits to £37.1m, Mothercare said lit had achieved like-for-like UK sales growth of 1.4% despite a 'challenging market'.

Other risers included credit checking firm Experian, 7p better at 493p after impressing the market with better than expected full year profits despite the difficult backdrop.

In the FTSE 250, soft drinks firm Britvic fizzed 13% higher or 34.25p to 303p after a 16% rise in half-year profits and encouraging noises about 'modest improvements' in the market.