London close: Footsie ends deep in the red
Top stocks ended the day heavily lower as further losses at Northern Rock hit sentiment, while Alliance and Leicester lost a third of its value by close.
The Bank of England is reportedly looking for a buyer for Northern Rock with the market hoping for a quick resolution as the crippled bank's savers pulled out even more money today.
Alliance & Leicester was lower in the morning after it was taken down to 'sell' from 'neutral' by Merril Lynch but just before close it fell even further, finishing over 30% lower on the day.
HBOS, Barclays and Royal Bank of Scotland were all sharply lower, but the fall-out spread wide.
Housebuilders Persimmon and Barratt were down on fears of the damage Northern Rock's problems will have on the housing market. Property groups British Land, Hammerson, Liberty and Land Securities were also down, not helped by a gloomy projection from Merrill Lynch on the growth prospects for the London office market in 2008.
Pub group Mitchells & Butlers said the marking-to-market loss on a hedge it took out against the shelved property joint venture with R20 has more than doubled. Elsewhere in the sector, Enterprise Inns and Punch Taverns posted heavy losses.
Only a handful of Footsie constituents made headway. Sage was the best performer with Smith & Nephew and Diageo also ahead.
Elsewhere, oil group Burren Energy saw interim net profit dip by 5% to $133m, slightly better than market forecasts, as production costs and oil prices dipped. The dividend rose by 25%.
Shares in Anglo-US surgical instruments maker Gyrus looked sickly after the company saw good underlying performance in the first half dragged back by the weak dollar, a situation it expects to be repeated over the remainder of the year.
Northern Foods was wanted after a broker upgrade from Panmure Gordon this morning. The broker rates the shares a buy and has set a price target of 140p.
Stockbroker Collins Stewart maintained its position despite tougher conditions in the first half. "Despite the less buoyant market conditions in the reporting period compared with the first half of 2006, underlying revenue has remained stable at £129.3m, operating profit has increased by 3% to £40.5m and margins have increased to 31.3%," it said. Stated interim pre-tax profits rose by 64% to £52m.
Consumer electronics firm Armour says underlying profits exceeded expectations for the year to August. "Both the core product based operating divisions, Armour Home and Armour Automotive, have made strong progress in the year," the group said.
PlayWize doubled its value after the software developer for the gaming industry announced it has won a development and licence agreement with Ladbrokes.
FTSE 100 - Risers
Sage Group (SGE) 250.00p +2.77%
Smith & Nephew (SN.) 572.00p +0.70%
Diageo (DGE) 1,050.00p +0.38%
ICAP (IAP) 477.00p +0.37%
Reuters Group (RTR) 645.00p +0.16%
BT Group (BT.A) 316.75p +0.16%
Shire (SHP) 1,155.00p +0.09%
SABMiller (SAB) 1,326.00p 0.00%
Cable & Wireless (CW.) 172.00p 0.00%
Imperial Chemical Industries (ICI) 637.00p -0.08%
FTSE 100 - Fallers
Northern Rock (NRK) 282.75p -35.45%
Alliance & Leicester (AL.) 600.00p -31.27%
Enterprise Inns (ETI) 578.00p -7.37%
Barratt Developments (BDEV) 769.00p -7.29%
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Persimmon (PSN) 946.00p -6.89%
Punch Taverns (PUB) 972.00p -6.00%
Home Retail Group (HOME) 376.50p -5.76%
Hammerson (HMSO) 1,099.00p -5.75%
Kingfisher (KGF) 185.40p -5.70%
Land Securities Group (LAND) 1,575.00p -5.63%
FTSE 250 - Risers
Hikma Pharmaceuticals (HIK) 425.00p +4.68%
Northern Foods (NFDS) 97.50p +4.00%
Intertek Group (ITRK) 920.00p +2.00%
Bankers Investment Trust (BNKR) 411.00p +1.80%
Go-Ahead Group (GOG) 2,518.00p +1.66%
Tullett Prebon (TLPR) 393.50p +1.61%
Renishaw (RSW) 638.00p +1.59%
PZ Cussons (PZC) 167.50p +1.52%
Hochschild Mining (HOC) 350.25p +1.45%
Aga Foodservice Group (AGA) 421.50p +1.44%
FTSE 250 - Fallers
Minerva (MNR) 216.25p -16.34%
Bradford & Bingley (BB.) 279.00p -15.39%
CLS Holdings (CLI) 466.25p -12.77%
Tr Property Investment Sigma Shares (TRYS) 90.75p -8.10%
Gyrus Group (GYG) 398.00p -8.08%
Big Yellow Group (BYG) 472.50p -7.71%
Grainger (GRI) 426.75p -7.48%
Investec (INVP) 480.00p -7.07%
Redrow (RDW) 438.00p -7.01%
Pendragon (PDG) 59.75p -7.00%
