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FTSE slumps towards fourth straight weekly loss
by Chris Marshall on Aug 30, 2013 at 09:41
Airlines bore the brunt of share selling on Friday morning, pushing Britain’s FTSE 100 towards a 2% loss in August, amid uncertainty over intervention in Syria and a weak report on German retail sales.
Equity markets across Europe and Asia declined, with the FTSE 100 heading for its fourth week in a row lower, down 39 points or 0.6% on the day to 6,446. The benchmark index is still up 10% year to date.
The move lower comes amid reports that the US is still prepared to move against Syria, even after British prime minister David Cameron failed to win parliamentary support for military strikes.
Brent crude oil futures had earlier fallen below $115 a barrel, to recover slightly higher at $115.18.
Traders also cited end-of-month bearishness, ongoing concerns over the end of US monetary stimulus and selling ahead of a long weekend in the US. A report showed that German retail sales dropped by 1.4% in July, marking the second consecutive drop.
Airlines among biggest losers
The selling was broad-based in London, but airline shares, which have recently been hit by the rising oil price, fell hardest. Easyjet (EZJ.L)dropped nearly 3% to £12.23, while IAG (ICAG.L) was 2.3% lower at 285p. Dublin-listed Ryanair shares fell 2% to €6.48.
On the mid-cap index Bwin.Party (BPTY.L) fell 12% to111p as the online gambling company warned that full-year profits could be as much as 17% below 2012 levels.
Vodafone adds to gains
Among only a handful of FTSE risers, Vodafone (VOD.L) gained another 0.4% to 205p, adding to yesterday’s gains after the mobile phone company said it was in advanced talks with Verizon Communications to sell its 45% stake in their US joint venture Verizon Wireless for about $130 billion (£83.75 billion).
Vodafone was unusually trading in larger volumes than Lloyds, the bank that almost always switches hands more than any other blue chip on any given day.
G4S (GFS.L) was the top Footsie riser, up 2% to 256p as investors continued to assess the embattled security group’s move earlier this week to raise £348 million from leading shareholders.
Pound steady as house prices rise
The British pound rose marginally, at $1.5516, amid more upbeat economic reports. Nationwide reported that house prices rose by 0.6% in August, while the British Chambers of Commerce upped its forecast for 2013 GDP growth to 1.3% from 0.9%.
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- International Consolidated Airlines Group SA (ICAG.L)
- easyJet plc (EZJ.L)
- Bwin.Party Digital Entertainment PLC (BPTY.L)
- G4S PLC (GFS.L)
- Vodafone Group PLC (VOD.L)