100 Stocks in FTSE Decline in London

123jump.com Staff
16 Aug, 2007
New York City

FTSE 100 Index in London fell 4.1% as investors avoided mining and financial stocks. Of the 102 stocks listed in the index, all members declined. The steep decline in the index was widespread across the European region. Of th FTSE 100 stocks 30 stocks dropped more 5% and the rest declined between 1% and 4.9%. Antofagasta led the decliners with a loss of 11%. British Land lowered its earnings outlook and Royal Mail earnings fell on higher overhead.

[R]7:00PM London, 2:00PM New York - London stocks fell in unprecedented sell-off amid deepening investor worries over continuing troubles in the US credit market. EU wants rating agencies probed.[/R]

Anxious investors exited equities enmasse, as concern piled London exposure to troublesome US mortgages may be worse than any other European state. London dipped 4.1% with all 102 shares closed lower and 30 stocks fell by more than 5% while 67 shares dropped between 1% and 4.9%.

In London trading FTSE 100 sank 4.1% to 5,858.9 dragged by mining, energy and bank stocks. The National Statistics office reported that second quarter retail sales were up 1.1% from previous quarter, led by non-food shops that rose 2.1%. Food stores added 0.4%. Sales by non-food stores rose 5.4% year-on-year versus 0.4% for food outlets. Total sales volumes in the quarter lifted 4% while average weekly sales value in July stood at 5 billion pounds, up 3.3%. The labour market added 93,000 new jobs to 29.1 million employees while the unemployed fell by 45,000 to 1.7 million. Earnings, outside bonuses surged 3.4 percent, the National Statistics said.

French President Nicholas Sarkozy wants rating agencies investigated for failing to detect risks that lead into financial markets crisis. UK is worried about the $44 billion worth of U.S. mortgages it currently holds-the biggest in Europe. Rams Home Loans Group in Australia has reported failing to repay a $5 billion US short-term debt. Similar cash crisis trends amongst financial firms are spreading rapidly in Europe.

Mining and financial stocks drove the London decline. All stocks in the FTSE 100 index declined led by Antofgasta plc with a loss of 10.98% followed by Lonmin plc down 9.41%. Anglo America plc lost 9.36%, Kazakhymys plc down 8.46% while Vedanta Resource shed 8.4%. Banking groups, Man Group plc and Standard Chartered dropped 8.31% and 7.6% respectively pulled further by the U.S. credit market turmoil. Not a single stock in the index of with 102 members in London gained.

British Land Co lowered first quarter profit by 34% to 275 million pounds or 53 pence per share. In the corresponding quarter a year ago, the firm reported a profit of 415 million pounds. The stock closed 0.66% lower.

Royal Mail said net income also drove back 50% to 194 million pounds due to weak pricing and bulging overheads. Royal Mail reported an operating loss of 12 million pounds. Costs rose to 5.97 billion pounds, up 181 million pounds even when 6,000 jobs were cut to reduce costs in 2006. On each stamped article, the firm made an average loss of 5.6 pence.