FTSE down; 4th straight session of loss

 

The leading share index was down 0.5 percent in opening trade on Friday, with financial and commodity stocks dragging the index lower as demand deadened ahead of important U.S. non-farm payroll data due at 1:30 p.m.

At 9:19 a.m. the blue-chip FTSE 100 was down 25.58 points at 5,022.23, after ending 86.09 points lower on Thursday, its lowest closing level in more than two weeks.

The falls reflected losses on Wall Street, which endured its worst day in three months, and in Japan where the Nikkei hit a two-month low, following a slew of economic data both in the UK and U.S. that missed market expectations.

"The mixed economic news on Thursday puts a great deal more emphasis on the jobless figures this afternoon in the U.S., which will give us a clue as to whether unemployment is getting in the way of any economic recovery" said Richard Hunter, head of UK equities at Hargreaves Lansdown.

"It is that particular jitter which is undoing us at the moment."

Hefty gains in the three months to September helped UK shares post their best quarterly performance since the index was launched in 1984.

Miners topped the list of fallers as metals prices softened across the board over concerns that the demand outlook could weaken given worries over the speed of the economic recovery.

Xstrata fell 1.3 percent as UK regulators said it must make a formal takeover bid for rival miner Anglo American, down 1.2 percent, by October 20 or walk away for six months as Anglo again rejected a merger. 

Lonmin, BHP Billiton, Kazakhmys, Rio Tinto and Eurasian Natural Resources shed 0.7 to 2.9 percent.

Oils lost ground as crude slipped back below $70 a barrel.

Cairn Energy, Tullow Oil, BG Group, BP and Royal Dutch Shell were down 0.2-2.3 percent.

FINANCIALS DECLINE

Investors took the opportunity to book profits on the life insurance sector, which has seen much interest recently on the back of continued M&A speculation.

Legal and General, which is widely perceived to be on the bid radar for either Resolution or an Australian firm, fell 4 percent.

L&G's shares have risen 26 percent since Monday. Goldman Sachs removed the stock from its "Conviction Buy" list on Friday.

Prudential, Standard Life, Aviva, and Friends Provident dropped 0.9 to 3.2 percent.

Banks were among the biggest decliners, with Barclays, Lloyds Banking Group, Royal Bank of Scotland and Standard Chartered falling 1.3 to 2.5 percent. 

However, HSBC bucked the trend, rising 0.6 percent.

Pharmaceutical stocks, which have responded well to the rally of late, due to a rising dollar, their exposure to the United States, helped by takeover moves in the global sector also relinquished some gains.

Shire, GlaxoSmithKline and AstraZeneca lost 0.2 to 2.7 percent.

On the upside, as risk appetite waned, defensively perceived plays became the focus of investors' attentions.

British American Tobacco gained 0.2 percent, while Unilever added 0.8 percent.

SABMiller was the top FTSE 100 riser, up 1.0 percent helped by positive comment from Cazenove, which repeated its "outperform" rating on the brewer.

Drinks firm Diageo rose 0.3 percent with Cazenove also repeating its "outperform" rating on the company.

On the economic front, the British housing market is stabilising. House prices rose for a fifth month running to turn flat on the year in September, the Nationwide Building Society said.