FTSE Close: Aviva, Pru down; Gold hits record high

 

17.00 (close)

People walk past London's Stock Exchange

Taking stock: Investors been waiting for an update from the Federal Reserve.

Gold mining stocks bucked wider falls on the London market today as the cost of the precious metal soared to new record highs.

Investors flocked to the safe haven of gold as stocks on both sides of the Atlantic slipped into the red, with the dollar also under pressure following cautious comments from the US Federal Reserve.

The FTSE 100 Index closed 24.3 points lower at 5551.9, while the Dow Jones Industrial Average also fell in volatile trading.

The US central bank yesterday kept the door ajar for more action to stimulate demand, but stopped short of providing specific detail.

The flight to safety meant the price of gold set its latest high at 1296.2 dollars an ounce, while the greenback fell sharply against other major currencies.

The pound was also under pressure after minutes from the Bank of England's latest monetary policy committee meeting reinforced expectations that interest rates will remain at a record low of 0.5% for some time. Sterling held its ground against a weak dollar, at $1.57, but fell almost 1% to 1.17 euros.

The ascent in the price of gold meant African Barrick Gold and Randgold Resources were high up on the risers board in London, up 14.5p to 601p and 180p to 6490p respectively.

Other commodity stocks were also higher, with Xstrata 31p stronger at 1198.5p and Rio Tinto up 82.5p at 3652.5p.

The risers board also included Imperial Tobacco, which climbed 2% higher - up 32p to 1925p - after the world's fourth-largest tobacco group said it remained on track to meet expectations with revenues forecast at 3% for the year to September.

Insurers were among the heavy fallers, with Aviva down 20p to 397p and Prudential off 6p to 613p. Marks & Spencer was also under pressure with a fall of 4.5p to 376.8p.

Another quiet session for corporate news was dominated by the announcement from FirstGroup that its founder and chief executive Sir Moir Lockhead planned to leave the transport business at the end of March.

He will be replaced by former London Underground boss Tim O'Toole, but the announcement came as little surprise to investors as shares remained close to their opening mark with a drop of 1.9p to 349.5p.

The biggest rise in the FTSE 250 Index came from Shanks Group following market speculation of fresh takeover interest from US private equity firm Carlyle.

The waste disposal group walked away from talks with Carlyle earlier in the year after rejecting an offer at 120p a share. The shares jumped 6% or 6.7p today, but at 110.2p are still below the offer price earlier this year.

The biggest Footsie risers were Antofagasta up 37p to 1214p, Kazakhmys ahead 41p to 1441p, Randgold Resources up 180p to 6490p and Xstrata up 31p to 1198.5p.

The biggest Footsie fallers were Aviva down 20p to 397p, Autonomy Corporation off 61p to 1768p, Invensys down 9.6p to 281.7p and Weir Group down 45p to 1395p.

16.00 Yesterday's gloomy outlook from the Fed and hints of further support saw - as predicted - a shaky start to trading on the Dow Jones.

It is currently down 7 points at 10,754.

The US central bank kept the door ajar for more action to stimulate demand, but stopped short of providing specific detail.

Gold prices set a latest high at $1294.8 an ounce, while the greenback fell sharply against other major currencies.

Aviva is now down 16.6p to 400.4p and Prudential dropped 2p to 617p. Marks & Spencer was also under pressure with a fall of 4.1p to 377.2p.

13.55:

An explanation of the Aviva falls today - the insurer is down 13.9p, or 3.33%, at 403.1p.

The shares have gone ex-dividend today.

The FTSE 100 is now 15.64 points lower at 5560.55.

13.20:

The ascent in the price of gold means African Barrick Gold and Randgold Resources are topping the risers board, up 13p to 599.5p and 135p at 6445p respectively.

Other commodity stocks are also higher, with Xstrata 24.5p stronger at 1192p and Rio Tinto up 65p at 3635p.

The risers board also includes Imperial Tobacco, which has climbed 2% higher - up 36p to 1924p - after it said it remained on track to meet expectations with revenues up 3% in the year to September.

The biggest rise in the FTSE 250 Index has come from Shanks Group following market speculation of fresh takeover interest from US private equity firm Carlyle.

The waste disposal group walked away from talks with Carlyle earlier in the year after rejecting an offer at 120p a share. The shares have jumped 11% or 11.2p today but at 114.7p are still below the offer price earlier this year. 12.35:

House of Fraser has followed the trend of focusing more heavily on in-house ranges, and perked its figures up accordingly.

Read more on the retailer here.

At lunchtime, the Footsie is 35.81 points worse off at 5540.38.

11.00:

Another all-time high for gold!

Gold was fixed this morning at $1,291.75 an ounce compared with $1,275.00 at the previous close. It takes the metal past the previous high - hit on Monday - of $1,283.8. (Read more...)

The FTSE 100 has clawed back some of the early losses and sits 28.33 points lower at 5547.86.

10.40:

Sterling has fallen today after those MPC minutes opened the door to another round of quantitative easing.

Sterling fell nearly a third of a cent against the dollar and gilt futures rallied as traders bet the bank could yet expand the £200bn programme, especially after the US Federal Reserve last night signaled it too stood ready to inject further stimulus.

The FTSE 100 continues to labour, down 40.39 points at 5535.80.

09.50:

The FTSE 100 headed sharply lower today with sentiment knocked after Fed issued a flat statement on the US economy, and with Aviva and Lloyds among the heavy fallers.

A poor start in London saw the Footsie 47.72 points down at 5528.47 by 9.40am. Overall, some 85 of the 100 blue chip stocks were in negative territory.

The absence of any firm action from US policymakers disappointed some investors as the Footsie slipped 30.1 points to 5546.1. This was after the Dow Jones Industrial Average closed near to its opening mark in the wake of the Fed's decision to leave policy unchanged.

UK economy watchers will eye the latest Bank of England Monetery Policy Committee (MPC) minutes. The MPC kept rates on hold but attention will be focused on signs that further quantitative easing will be supplied.

Shares on the back foot in London included insurer Aviva, which slipped 3% or 13.6p to 403.4p, while the recent rally by Lloyds Bank Group came to an end as its shares fell 1.4p to 75.4p.

The mining sector did its best to prop up the top flight, while Imperial Tobacco shares were 1% higher - up 30p to 1923p - after the world's fourth-largest tobacco group said it continued to trade in line with expectations.

Another quiet session for corporate news was dominated by the announcement from FirstGroup that its founder and chief executive Sir Muir Lockhead planned to leave the transport business at the end of March.

He will be replaced by former London Underground boss Tim O'Toole, but the announcement received a lukewarm response from investors as shares dropped 3p to 348.4p.

On Wall Street later today, the futures markets have the Dow Jones opening lower. US shares are seen falling 39 points to 10,655.