LONDON (ShareCast) - The market has reversed course and the Footsie has dropped below the 5400 level, with investors deterred by the prospect of a weaker opening by Wall Street.

Oils and miners remain in favour bout outside of these sectors most blue-chips are lower.

Ferrexpo and ENRC lead the mining sector higher while Tullow Oil, Cairn and BG are the big gainers among oils. However, the 4% jump in the oil price overnight deflates demand for fuel users British Airways, FirstGroup and Carnival.

Lloyds TSB attracted early support on a report in the Telegraph that it has pulled out of bid talks with the German lenders Dresdner Bank and Deutsche Postbank, but has failed to hold the early gains. Elsewhere in the banking sector Royal Bank of Scotland (RBS) is lower after Zurich Financial Services confirmed late Thursday that it has decided to pull out of the race for Royal Bank of Scotland’s insurance arm. In better news for RBS, National Australia Bank is in talks with Royal Bank of Scotland to buy ABN AMRO's operations in Australia and New Zealand.

Thomas Cook reacts favourably to the ending of talks to merge its Condor airline with Air Berlin. Cook said discussions continue with Air Berlin about the feasibility of an alternative transaction, but it is also pursuing a range of other available options for Condor.

Carphone Warehouse is a rare firm feature in a retail sector that sees Kingfisher, Marks & Spencer and Next suffer some of the biggest falls among Footsie stocks.

Down a division, housebuilders are still buoyant on talk that bargain hunters and vulture funds are circling. Taylor Wimpey is sharply higher on reports that a US private equity firm plans to take a 30% stake, while Barratt, Bellway, Persimmon and Bovis are all posting good gains.

Mortgage lenders Bradford & Bingley and Alliance & Leicester also attract speculative support.

Support services group Serco tumbles after missing out on a £6.75bn five-year contract to clean up the Sellafield nuclear power plant. Serco was part of a consortium which lost out on the contract which was won by a rival consortium that included engineering firm Amec.

Magners cider group C&C's revenue for the four months ended 30 June, 2008 declined by 8%. There was a 10% fall for C&C's Cider division and growth of 3% for Spirits & Liqueurs. Group operating profit increased.

French electronics group Thales is to buy encryption software specialist nCipher for 300p per share, a bid that values the group at £50.7m in total.

Inkjet printer group Xaar has slumped on a warning profits this year will be below forecasts and in line with last time. Revenue for the six months to 30 June 2008 was approximately £22.5m (six months to 30 June 2007: £23.4m). Underlying profit before tax for the period was approximately £3.8m (30 June 2007: £3.1m).

Shares in Oxford Biomedica plummeted after the gene therapy group said the Data Safety Monitoring Board (DSMB) has advised it that a final stage clinical trial of its renal cancer treatment TroVax would not meet its defined goals.

Shares in Cadogan Petroleum advanced after the Ukraine focused oil and gas firm gave an update on its drilling activities.

Loss making security holographics group API has raised some cash through the sale of its former factory site in Shanghai, China.

Multimedia networks specialist Newport Networks slumped as it said it was “extremely disappointed” by recent trading, adding that selling the group is an option it is considering.

European online gaming group Gaming VC Holdings said trading in the first six months of the year has been slightly ahead of the board's expectations due to resilience in the German casino business.

FTSE 100 - Risers
Eurasian Natural Resources (ENRC) 1,112.00p +6.21%
Cairn Energy (CNE) 2,839.00p +3.54%
Tullow Oil (TLW) 869.50p +3.27%
Ferrexpo (FXPO) 321.50p +3.13%
BG Group (BG.) 1,169.00p +2.90%
Carphone Warehouse Group (CPW) 201.75p +2.52%
Amec (AMEC) 878.50p +2.03%
Wolseley (WOS) 312.25p +1.38%
Royal Dutch Shell 'B' (RDSB) 1,934.00p +1.31%
BP (BP.) 547.25p +1.30%

FTSE 100 - Fallers
Kingfisher (KGF) 94.80p -4.24%
Marks & Spencer Group (MKS) 230.25p -4.16%
Schroders NV (SDRC) 745.00p -2.93%
FirstGroup (FGP) 544.50p -2.85%
Liberty International (LII) 823.50p -2.83%
Reckitt Benckiser Group (RB.) 2,453.00p -2.66%
Next (NXT) 873.50p -2.46%
Schroders (SDR) 824.50p -2.43%
Enterprise Inns (ETI) 323.00p -2.42%
British Sky Broadcasting Group (BSY) 434.00p -2.09%

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