Mixed corporate earnings see FTSE end down as Eurozone fears grow

BRITAIN’S top share index fell yesterday as mixed earnings reports combined with concerns about the Eurozone’s economy and debt troubles to weigh on sentiment.

Tate & Lyle and Land Securities were among fallers in heavy volumes after releasing disappointing earnings updates. Land Securities had gained 25 per cent year to date, with Tate & Lyle adding nine per cent in October.

“These are stocks that were untouchable, they were absolutely rock solid and they were smashing through indicators to go short. Finally with a sell-off starting yesterday, it was these stocks which seemed to drop quite sharpish,” said Ed Woolfitt, Head of Trading at Galvan, said.

“It would have been longer-term runners and well-performing companies that finally buckled, and if institutions took the profits out then that would cause the swing. I think it began as profit taking, then profit taking turned to fear.”

The FTSE 100 index closed down 15.58 points, or 0.3 per cent, at 5,776.05, reversing earlier gains and pulled down by cyclical stocks sensitive to risk sentiment, such as energy, banks and mining.

Concerns over the state of the Eurozone resurfaced after European Central Bank president Mario Draghi described the outlook as “a picture of weaker economies,” and traders cited fears that €31.5bn of aid for Greece, frozen since June, may be delayed further.

Tate & Lyle fell 0.5 per cent as the sweeteners and starches maker reported only a slight rise in first-half earnings, reflecting the cost of re-opening a factory and tough trading in Europe. Land Securities fell two per cent after lacklustre first-half results.