FTSE 100 CLOSE 5871.51 -56.40
Markets largely ignored the €530 billion (£450bn) cash injection into European banks yesterday, as investors waited to see how much of the money flows into the real economy.
Lloyds, which was 0.1p higher at 34.9p, confirmed it drew £11.4bn from the second tranche of the European Central Bank’s emergency facility – one of 800 financial institutions to take advantage of the cheap three-year loans. David Morrison, senior market strategist at GFT Global, said: “Analysts don’t expect this LTRO [ECB cash] to have the same positive impact on risk assets as December’s.”
The FTSE 100 Index, which had been more or less flat during morning trading, slumped 56.4 points or 1 per cent to 5,871.5 when US monetary chief Ben Bernanke warned that rising oil prices could dent recovery in the world’s largest economy, pouring cold water on better-than-expected growth figures.
Outside the top flight, Game Group slumped 16 per cent or 1p to 4.9p after the struggling retailer revealed that it will not stock EA’s forthcoming release Mass Effect 3, amid reports of a dispute with the US games giant.
But travel agent Thomas Cook was up nearly 23 per cent at 28.25p, after its shares took off for the second successive day. The battling holiday operator’s market value has nearly tripled in the past week, with speculation rife that its troubles could be behind it and a bid for the company may be in the offing.
Shares in oil explorer Bowleven contined to head south after Tuesday’s news that Dragon Oil would not be making a bid for the Edinburgh-based company. They were down 6 per cent at 96p, still well above their level before the latest round of M&A speculation, as investors continue to hope the company will soon find another suitor.
New York: Wall Street dipped last night, snapping a four-day winning streak after comments from US Federal Reserve chairman Ben Bernanke disappointed investors hoping for a strong signal of more stimulus.
The Dow Jones industrial average dropped 53.51 points, or 0.41 per cent, to end at 12,951.61 while the broader Standard & Poor’s 500 Index shed 6.52 points, or 0.48 per cent, to finish at 1,365.66. The Nasdaq Composite Index fell 19.87 points, or 0.67 per cent, to close at 2,966.89.