FTSE edges up despite retail fears
The FTSE 100 bounced back in early trading after falls mainly triggered by miners who are fearful of a slowdown of growth in China.
However, gains were minimal with the tough climate for UK retailers being laid bare by data from Nationwide today showing that consumer morale is weakening.
Blue chip retailer Kingfisher, which owns B&Q, also added to the gloom by warning that the business rate hike in the Budget would hit the sector.
The fastest climber on the index was BT – up six per cent after saying it would pay off its pension deficit more quickly than expected.
BA owner IAG was up 2.5 per cent while pub and hotel group Whitbread lifted by 1.9 per cent.
Miner Vedanta edged up by two per cent while heavyweights in the sector Rio Tinto and BHP Billiton also nudged up as a bounce back in copper prices fuelled confidence.
However gold miner Randgold Resources, which has seen its price plummet after unrest in Mali where it has mines, dipped by another two per cent.
And it was not helped by the fourth week in a row that the price of gold has dropped.
In banking Lloyds was up 1.2 per cent, Barclays 0.9 per cent and RBS 0.8 per cent.
Meanwhile British banks need to raise fresh capital “as early as feasible” as the stability of the global financial system remains fragile, the Bank of England’s new risk watchdog said.
The Bank’s Financial Policy Committee said that banks had gone as far as they could to raise capital by keeping down pay, dividends and share buybacks.
Retailer Kingfisher was up two per cent despite its fears over business rates after reporting strong results yesterday.
Fallers on the index included British American Tobacco, down 0.3 per cent, and building services firm Wolseley, down 0.2 per cent.
In Asia the Nikkei and Hang Seng both closed down 1.1 per cent. The markets have been hit over the week by a string of data suggesting that the rapid growth of the Chinese economy is slowing.
Across the Atlantic later February new home sales data is due for release in the US with investors looking for an upturn in sentiment in the world’s biggest economy following mixed housing data earlier in the week.