Footsie flat as data show recession over
THE leading shares index stood still yesterday as investors heeded warnings that figures showing an end to Britain’s double-dip recession masked weak underlying health.
The FTSE-100 index had been higher after the Office for National Statistics revealed a higher-than-expected 1% surge in gross domestic product in the third quarter.
However, the top flight pulled back to close almost flat at 5805.05 as analysts warned the bounce-back was driven by oneoff factors such as the Olympics and growth would slow in the quarters ahead.
The strong headline figure did boost the pound, however, which rose to 1.61 against the dollar and 1.24 against the euro. Miners reversed gains towards the end of the session with Evraz sinking to the bottom of the Footsie, dropping 14.9p to 235.4p, while Eurasian Natural Resources dropped 8.2p at 333.4p.
Households goods giant Unilever was among the biggest blue-chip risers after beating expectations with a 5.9% rise in underlying sales. The Hellmann’s and Dove soap maker rose 2%, or 45p, to 2310p after the third quarter update.
Banks were also on the risers board, despite a profits drop at Spanish-owned Santander.
Parent Banco Santander reported a plunge in third quarter profits as it took a hit on real estate losses in Spain, while its UK arm also came under pressure after falling profit margins left profits 27% lower.
But Barclays brushed this aside, rising 2.95p to 232.9p, and Lloyds Banking Group was also ahead, up 0.2p to 40.7p, an improvement of 1%.
Advertising and marketing giant WPP was among the fallers, down 2%, or 18.5p, to 789.5p, 119 101 1251 1435 336 548 1921 170 1105 1337 2353 3987 249 3333 7891 1023 1321 4163 736 660 +10 +61 +77 +85 +20 +28 +93 +77 +47 +53 -147 -137 -85 -81 -181 -21 -23 -81 -14 -11 +9.17 +6.88 +6.72 +6.37 +6.33 +5.38 +5.37 +4.87 +4.64 +4.13 -5.95 -3.37 -3.34 -2.40 -2.29 -2.19 -2.00 -1.91 -1.87 -1.64 after it cut its full-year growth outlook for a second time in three months due to fears over the prospects for trading in the United States and Europe.
Debenhams surged to the top of the FTSE-250 index risers after it reported a 4.2% rise in pre-tax profits to £158.3 million for the year to September 1. The figures were accompanied by plans for another 17 UK stores over the next five years. The shares rose 9%, or 10p, to 119p.
The boost helped JD Sports Fashion, which lifted 12p to 752p, and Dixons Retail Group with an improvement of 0.3p to 21p.
Details of a 42% hike in fivemonth profits for ASOS failed to boost shares as the online retailer scotched talk of a bid by Amazon. The stock dropped 7%, down 167p, to 2326p.
Harry Potter publisher Bloomsbury was also lower, down 5%, or 6.8p, to 131.8p, after reporting a 42% drop in firsthalf profits to £850,000. STOCKS eked out small gains yesterday in another uninspiring session onWall Street, with worries about weak business spending keeping investors wary.
Therewere a fewbright spots, such as Procter Gamble, which rose 2.9%, after reporting stronger-than-expected results. However, that was not enough to motivate investors reeling from a sharp decline in recent days.
US durable goods orders rose more than expected in September, though orders excluding volatile defence goods and aircraft were unchanged, and business investment showed signs of stalling.
“Global concerns are always in the background and people haven’t forgotten about it. “That’swhat markets on Friday and earlier this week told us,” said Jaewoo Nakajima, associate managing director at Internat i o n a l Stra t eg y and Investment Group, in New York.
The Dow Jones industrial average rose 26.34 points, or 0.20%, to 13,103.68, the Standard & Poor’s 500 index gained 4.22 points, or 0.30%, to 1412.97, and the Nasdaq Composite index advanced 4.42 points, or 0.15%, to 2986.12.
With about 244 firms in the S&P 500 reporting results so far, 62.3 percent have beaten expectations, a slight improvement on the typical 62% average, Thomson Reuters data showed.