London close: Footsie takes another beating

08.06.2006

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London closed at its low for the day, turning down sharply in the last hour as US stocks also headed south.

Miners were the worst performers, with both BHP Billiton and Rio Tinto both down over 6%. Gold and silver prices fell sharply as the ECB disappointed some hawks by only raising eurozone interst rates by one quarter of a point to 2.75% and not by half a point. UK rates remained unchanged at 4.5%

Cairn Energy remains the worst performer though well off earlier lows. Fellow oil majors BP and Shell remained in the red after crude prices fell sharply overnight and continued their descent today on reports of the death of Iraqi militant Abumusab al-Zarqawi.

Fuel sensitive British Airways was a gainer on the news while supermarket groups Tesco and William Morrison climbed while J Sainsbury also pared losses.

Cable & Wireless was one of the few in the blue on news it is to cut 150 jobs at its Bulldog broadband unit as the troubled telecoms firm decides to move its focus to wholesaling rather than on residential and small business customers.

Goldman Sachs has dropped its bid for BAA leaving the way clear for Ferrovial to complete its takeover.

Drug giant AstraZeneca said today it believes the group has the potential to sustain its recent performance over the next five years following strong sales of five key growth products.

Water utility Severn Trent has been warned that it will be receiving a fine from regulator Ofwat for poor customer service, as part of its ongoing investigation.

Barclays has appointed ex-Citigroup man Federik Seegers to the new position of chief executive of its global retail and commercial banking operations while Lloyds TSB is said to have appointed Lehman Brothers as its joint corporate broker.

Business software group Sage Group has agreed to acquire Bäurer, a Germany business management software firm, for around £16m in cash. The deal is expected to complete within about four weeks.

Among the second liners, beleaguered healthcare software solutions provider iSOFT got slammed after it warned that a change to its accounting policy for the year to 30 April 2006 would see full year profits tumble.

Engineering outfit FKI said last year saw many positives despite a backdrop of materially increased and volatile input prices. Pre-tax profit rose 21.6% to £70.5m from £58m in the same period last year.

Bicycle retailer Halfords reported a well flagged set of full year figures today, with both profit and revenue well ahead and sales since the year end up 10.5%. Pre-tax profit for the year to March rose 3.6% to £77m

Executive recruitment group Whitehead Mann returned to profitability in the second half of the year, helping narrow full year losses after completing the group's reorganisation.

Catering equipment manufacturer Enodis revealed today that it has rejected another approach from a US group for undervaluing the business.

A sales warning late in the day knocked fertility test group Genosis, while dentist chain Oasis Healthcare jumped on a preliminary bid approach.

FTSE 100 - Risers

BSkyB (BSY) 559.00p +1.64%

Centrica (CNA) 279.00p +1.45%

Tesco (TSCO) 327.50p +1.08%