London close: Banks lead market plunge
The Footsie suffered a triple-digit decline today as fears resurfaced about the sub-prime and credit markets. Wall Street's weak opening added further impetus to London's decline in the late afternoon.
The banking and mining sectors were the worst affected.
Barclays took a dive despite denying reports this morning that it has lost hundreds of millions of pounds in the collapse of German bank, Sachsen.
The Financial Times reported that the bank provided back-up financing to one of four highly leveraged SIV-lite structured investment vehicles run by Sachsen and had an exposure in the "low hundreds of millions of dollars". Barclays claimed the report's figure was too high but declined to provide guidance figures as to its actual exposure.
Royal Bank of Scotland also declined following downbeat comments on the investment banking sector from Goldman Sachs in the US last night. The bid situation with ABN Amro is another concern.
Standard Life, Alliance & Leicester and Schroders were also lower.
Rio Tinto initially rose after it received US anti-trust clearance for the proposed acquisition of Alcan by its subsidiary, but it could not resist the sector trend and eventually closed lower. Lonmin enjoyed the dubious privilege of being the largest faller among FTSE 100 constituents.
In results news, oil services group John Wood reported continuing strong progress in 2007 and said it reckons full year results will top expectations.
The firm posted a 64% hike in pre-tax profit for the six months to 30 June to $124m on revenue 35% higher at $2.12bn. Earnings before interest, tax, depreciation and amortization climbed 61%.
Distribution and outsourcing business Bunzl saw interim profits rise but warned the weak US dollar could have a negative affect on full year results.
"The current value of the US dollar is somewhat weaker than the average for the second half of 2006 and, should that continue...it would have a negative translation effect on our full year results for 2007," said the group.
Scanning software specialist Dicom pushed full year profits ahead by 5% as margins increased despite flat sales.
Pre-tax profits rose from £9.6m to £10.1m in the year to end June, on revenues of £160.2m against £160.4m, though in local currencies there was a 4% improvement. Adjusted operating profits rose 8% to £15.5m as gross margins picked up a couple of percentage points to 56.4%.
Car rental firm Avis Europe announced Tuesday it had more than halved underlying losses during the first half Tuesday and said revenues had remained strong in July and August to date.
The group reported an underlying loss of €1.9m versus a €4.5m deficit this time last year on revenue excluding discontinued operations up 4.7% to €604m. Total loss before tax excluding discontinued operations narrowed to €7.9m from €13.2m.
Residential property owner Grainger said it has completed the fundraising for its residential investment fund G:res after raising £159m.
FTSE 100 - Risers
Drax Group (DRX) 645.00p +1.65%
Enterprise Inns (ETI) 613.50p +0.90%
British Airways (BAY) 412.75p +0.86%
Punch Taverns (PUB) 1,049.00p +0.10%
ITV (ITV) 106.90p +0.09%
Shire (SHP) 1,263.00p +0.08%
British Sky Broadcasting Group (BSY) 662.50p +0.08%
Kelda Group (KEL) 826.00p -0.30%
Severn Trent (SVT) 1,305.00p -0.38%
3i Group (III) 1,030.00p -0.39%
FTSE 100 - Fallers
Lonmin (LMI) 2,981.00p -6.02%
Schroders Nv (SDRC) 1,103.00p -4.67%
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Standard Life (SL.) 284.50p -4.29%
Experian Group (EXPN) 511.00p -4.13%
Alliance & Leicester (AL.) 1,008.00p -3.91%
Schroders (SDR) 1,283.00p -3.90%
BG Group (BG.) 739.50p -3.90%
Daily Mail and General Trust (DMGT) 659.00p -3.87%
Northern Rock (NRK) 712.00p -3.72%
Wolseley (WOS) 1,011.00p -3.71%
FTSE 250 - Risers
John Wood Group (WG.) 352.50p +4.68%
Henderson Group (HGI) 140.75p +4.07%
Keller Group (KLR) 1,029.00p +2.80%
RPS Group (RPS) 358.50p +2.80%
easyJet (EZJ) 531.00p +2.41%
London Stock Exchange Group (LSE) 1,344.00p +2.36%
JPMorgan Japanese Inv Trust (JFJ) 208.50p +2.21%
Morgan Sindall (MGNS) 1,681.00p +1.88%
Informa (INF) 533.00p +1.62%
JD Wetherspoon (JDW) 563.00p +1.44%
FTSE 250 - Fallers
PartyGaming (PRTY) 22.75p -7.14%
St. Modwen Properties (SMP) 510.00p -7.02%
Aberdeen Asset Management (ADN) 163.50p -6.03%
Premier Farnell (PFL) 176.25p -5.37%
Aquarius Platinum (AQP) 1,387.00p -5.26%
Bradford & Bingley (BB.) 369.00p -5.20%
Great Portland Estates (GPOR) 628.00p -4.99%
Ashtead Group (AHT) 120.00p -4.95%
CSR (CSR) 604.00p -4.88%
Hiscox (HSX) 259.00p -4.87%
