THURSDAY MARKET CLOSE: Downbeat earnings drag on equities

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The FTSE 100 Index slumped into the red as poor corporate results and economic data failed to validate the recent uplift in sentiment.

The top tier finished 53.05 points or 0.8 per cent lower at 6,773.28 – erasing a week’s worth of small gains in a session – while it was a similarly downbeat picture across Europe following the latest batch of US company results and a worrying Chinese manufacturing report overnight.

Publisher Pearson weighed on the index after a gloomy profit alert pushed its shares more than 8 per cent lower. It was down 107p at 1,191p.

EasyJet was also down after the low-cost airline’s latest update failed to keep up its record for exceeding expectations.

Michael Hewson, chief market analyst at CMC, said: “On the plus side the company moved more passengers and increased its revenues but given that the shares have doubled in the last 12 months some profit taking shouldn’t be unexpected.”

The stock dropped 4 per cent or 71p to 1,672p.

SSE shares were 3p higher at 1,320p after the energy company said it was on course to boost profits by nearly 9 per cent and increase its dividend payout this year.

It was joined on the risers’ board by under-pressure retailer Marks & Spencer after it received the support of broker Exane BNP Paribas, which raised its target price from 390p to 570p and said the company had the right strategy in place to drive pre-tax profits up by 40 per cent over the next three years. M&S shares were 3 per cent higher, up 12.3p at 493.2p.

Meanwhile another retailer looks set to join the London Stock Exchange, as it was reported that talks to sell House of Fraser privately had ended without a deal. The department store chain had kept plans for a £350 million flotation in place as it considered an approach from French rival Galeries Lafayette.