London Report: FTSE rally stalls on weak results

A FALL in drinks group SABMiller and engineer GKN knocked Britain’s main equity index off seven-week highs yesterday, with some traders expecting the market’s recent rally to stall in the near term.

The FTSE 100 index closed down by 0.5 per cent, or 32.48 points, at 6,587.95 – marking a retreat from seven-week highs reached this week.

The FTSE hit a 13-year high of 6,875.62 points in late May.

SAB fell 2.5 per cent after posting lower sales, dragging down rival Diageo by 1.8 per cent with both companies taking the most points off the FTSE.

GKN also fell 4.2 per cent to make it the worst-performing FTSE stock after its shares were hit by speculation of a GKN bid for US group Spirit AeroSystems. GKN declined to comment on the rumours.

The FTSE 100 has risen nearly 10 per cent from lows of around 6,000 points reached in June, but some signs of weak corporate results this month have stalled that rally.

But Shire and Rolls-Royce were the top two risers after upbeat results, up 5.5 and 5.1 per cent respectively.