London close: Mining slide aids Footsie decline
Further profit taking and a poor start on Wall Street sent London's leading index tumbling through 5,900, with banks and PartyGaming big losers, while miners reversed early gains.
UK lender HBOS beat expectations with a 17% rise in pre-tax profits for the first half, though news that bad debts also soared overshadowed the results.
The group said bad loans jumped 21% to £6.7bn, largely on the back of a rise in unsecured loans which saw provisions jump by a third to £1.7bn. Analysts were also disappointed with a 4% increase in profits at the retail unit.
The report dragged on the rest of the banking sector with Standard Chartered, Alliance & Leicester and Lloyds TSB all heading lower, while HSBC slipped after broker West LB cut the shares to 'hold' from 'add'.
Water utility Severn Trent gave back some of Monday's gains as bid hopes began to fade and as investors mulled yesterday's UBS downgrade to 'reduce' from 'neutral'.
Elsewhere, Kazakhmys finished lower despite pushing ahead at the start. The Kazakh-based copper miner said it was still seeing strong levels of copper extraction in the latter stages of the first half.
Chilean copper miner Antofagasta also gave back gains despite announcing an increase in copper extraction during the second quarter compared with the first. Cash costs were also 11.7% lower than the previous period.
HSBC upgraded miner Xstrata to 'outperform' from 'neutral' as part of a wider mining note. The broker highlighted the benefits of its acquisition of Falconbridge, but the shares fell in line with the market.
Life insurer Standard Life lost its early advantage despite reporting insurance sales up 17% during the first half thanks to a strong performance from the UK business, although Unilever featured among the risers ahead of second quarter numbers due Thursday.
Builders' merchant Travis Perkins reported better than expected second quarter results, with a pre-tax profit of £110.4m, up slightly on last year and ahead of expectations.
Plumbing merchant supplier Wolseley worked its way higher after it benefited from a positive read through from Travis Perkins' results.
Retirement homes builder McCarthy & Stone has recommended today's higher cash offer from the bidding vehicle led by HBOS, the Reuben brothers and retail entrepreneur Tom Hunter, priced at 1,075p per share, valuing the company at about £1.1bn.
Fellow housebuilder George Wimpey said its first half figures showed progress and expects the outcome for 2006 to be in line with expectations, though completions in the US are expected to be below 2005 levels.
Adding to the good news was a report from the usually conservative Nationwide, which revealed house prices picked up 0.8% in July, taking the annual rate of house price inflation to 5.9%.
Gambling firm William Hill hiked its dividend by 18.9% to 7.25p per share after a positive set of interim results and announced a joint venture to provide sports betting in Spain.
Jardine Lloyd Thompson, the insurance broker, has warned that trading remains challenging, adding that benefits from its review will not feed through properly until 2008.
Toiletries and cleaning products maker PZ Cussons polished up its full year pre-tax profit after a good performance from emerging market such as Nigeria. Pre-tax profit climbed 9% to £63.6m for the year to May.
FTSE 100 - Risers
Cairn Energy (CNE) 2,147.00p +1.71%
BG Group (BG.) 728.50p +1.18%
Imperial Chemical Industries (ICI) 375.00p +1.15%
Tate & Lyle (TATE) 692.00p +1.02%
Rentokil Initial (RTO) 165.25p +0.92%
Centrica (CNA) 295.25p +0.77%
Wolseley (WOS) 1,148.00p +0.70%
Gallaher (GLH) 895.00p +0.39%
Unilever (ULVR) 1,270.00p +0.32%
Persimmon (PSN) 1,284.00p +0.31%
FTSE 100 - Fallers
PartyGaming (PRTY) 105.75p -3.42%
Carnival Corporation (CCL) 2,076.00p -2.76%
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Smith and Nephew (SN.) 450.25p -2.33%
Severn Trent (SVT) 1,269.00p -2.23%
Lonmin (LMI) 2,863.00p -2.09%
BHP Billiton plc (BLT) 993.00p -2.07%
Standard Chartered (STAN) 1,328.00p -1.92%
SABMiller (SAB) 1,054.50p -1.91%
Sage Group (SGE) 228.25p -1.83%
Amvescap (AVZ) 510.00p -1.73%
FTSE 250 - Risers
PZ Cussons (PZC) 1,458.00p +5.27%
Travis Perkins (TPK) 1,605.00p +5.25%
Bodycote (BOY) 237.00p +4.52%
Dana Petroleum (DNX) 1,195.50p +3.78%
Wolfson Microelectronics (WLF) 467.00p +3.32%
Petrofac Ld (PFC) 272.25p +3.32%
GKN (GKN) 267.75p +3.18%
Laird Group (LARD) 364.50p +3.04%
Burren Energy (BUR) 914.00p +2.93%
Expro International (EXR) 651.50p +2.92%
FTSE 250 - Fallers
888 Holdings (888) 143.00p -7.74%
CSR (CSR) 1,080.00p -4.85%
RPS Group (RPS) 215.00p -3.59%
Investec (INVP) 2,699.00p -3.43%
Jardine Lloyd (JLT) 357.00p -3.38%
Catlin Group (CGL) 425.00p -2.97%
Dairy Crest (DCG) 519.25p -2.94%
Helphire Group (HHR) 335.00p -2.90%
Babcock International (BAB) 331.00p -2.79%
Electrocomponents (ECM) 229.25p -2.76%
