Footsie reined in as eurozone falls flat

BLUE-chip stocks gave ground as concerns over the eurozone brought markets back from near-two-year highs yesterday.

The FTSE 100 index, which had closed at its highest level since June 2008 on Tuesday, closed down 18.3 points at 5,762.1.

There was little help from Wall Street as traders took profits from recent advances, sending the Dow Jones industrial average modestly down by London's 4:30pm close.

With little corporate news, traders focused on revised official figures showing flat growth in the countries using the euro during the last three months of 2009.

UK service sector figures also came in slightly below expectations, despite better news on jobs. The pound held its own against the dollar at $1.52 although it ticked above 1.14 with concerns over Greek debt continuing to sap the single currency.

Heavyweight mining stocks were mostly lower in London as metal prices echoed the temporary pause in equity markets.

BHP Billiton and Antofagasta were the two biggest casualties, down 59.5p at 2,275p and 26p at 1,068p respectively.

The main move of the session came from hedge fund Man Group after a strong weekly performance from its previously stuttering AHL fund as well as positive broker comment. Man's shares jumped more than 6 per cent, or 15.4p, to 267.4p.

Many retailers were also on the front foot after broker Citigroup upgraded fashion chain Next, helping shares up 44p to 2,253p. B&Q-owner Kingfisher was also up 6.2p to 229.8p, while Home Retail Group, which owns Argos and Homebase, was 4.3p better off at 279.3p.

One of the leading Footsie fallers was EnQuest following the merger of the North Sea assets of oil and gas services firm Petrofac and Sweden's Lundin Petroleum. Shares in the stock, which will be demoted from the Footsie tomorrow, fell 3.75p to 99.95p.

A number of stocks were hit as they went ex-dividend, meaning new investors are now not entitled to the latest payout. Financial Times publisher Pearson was off 43p to 1,007p, while British Land shed 13.4p to 477p.

British Airways fell 5.1p to 238.2p after it revealed that it carried 11.4 per cent fewer passengers last month due to strike action. It also estimated the total cost of the dispute for the month at between 40 million and 45m.

Among second-tier stocks, brewing-to-pubs group Marston's was up after it was helped by a strong Easter holiday trading period for its managed pubs estate.

Shares closed up 2.6p at 97.05p, as the group also said premium ale volumes rose 4 per cent in the first half of its financial year.

Royal Bank of Scotland dipped by 0.26p to 44.69p the day after the deadline passed for indicative bids for the 300-plus branches it has to sell at the behest of the European Commission as a condition for the state aid it has received.

It is understood the bidders are Santander, BBVA, Virgin Money, National Australia Bank and the private equity group JC Flowers.

Traders said RBS's shares were partly hit by a sell note from broker Seymour Pierce.

The broker said it believed revenue in the remaining core part of the business after asset sales "is likely to disappoint".

Still with the banks, Lloyds Banking Group dipped 0.05 per cent to 64.46p, while HSBC firmed 5.1p to 677.5p.