LONDON (ShareCast) - London has made a poor start with Punch Taverns' gloomy statement weighing heavily on the leisure sector.

Punch has axed its final dividend to conserve cash. Plans to convert to a REIT have also been shelved on cost grounds. "The main priority for the use of cash is to support the repayment of the group's convertible bonds," Punch said. Like-for like sales from its tenanted arm fell 3.4% over the year to 23 August with a fall of 3.3% at the managed estate. Enterprise Inns is well down in sympathy with Mitchells & Butlers also suffering.

Oil groups have also fallen back again on renewed weakness in the crude price and talk that the price could go below $100 per barrel. Airlines in contrat have jumped again on the prospect of cheaper fuel. British Airways and Easyjet are again making good ground.

Cable & Wireless is the best performer after insurer Prudential agreed to take responsibility for just over £1bn of pension assets and 5,000 scheme members from the telecoms giant.

Electricals retailer DSG's like-for-like sales tumbled 7% in the 16 weeks ended 23 August 2008. Total group sales rose 4% in sterling terms and fell 2% in local currency. The trading environment remains challenging across Europe with gross margins across the group down 0.75% year on year. "We remain very cautious about the consumer outlook," DSG said.

Engineer Hamworthy has discovered accounting errors related to inventory valuation at its inert gas systems business, with an overstatement in inventories of £4.6m over a number of years. An adjustment relating to the year ended 31 March 2008 is anticipated at £1m with the majority of the remainder relating to financial years 2005 to 2007. "The board believes that this is an isolated error," the statement said.

Packaging group DS Smith says overall trading in the first quarter of financial year 2008/09 has been in line with management's expectations with the total operating result in line with this time last year.

Prudential has entered into a bulk annuity buy-in insurance deal with the Cable & Wireless in relation to the pensioners 'in-payment' element of its defined benefit pension scheme. The book covers approximately 5,000 members with assets of just over £1bn.

James Bond gadgets group QinetiQ has been awarded a maritime facilities contract by the Ministry of Defence worth more than £150m over the next 15 years.

Speciality metal producer and recycler Metal-Tech crumpled today on news that the weaker dollar versus the Israeli Shekel will mean interim pre-tax profits falling "significantly" below expectations.

Falling property prices have plunged A&J Mucklow into a full year loss and it said the challenging market conditions mean a further drop in values is possible.

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