FTSE sneaks ahead after early losses

SHAREHOLDERS in Perth-based transport firm Stagecoach were yesterday advised to vote against the directors’ remuneration report over fears that executive pay “could potentially be excessive” under the current scheme.

While influential investor advisory body Pirc said that this year’s pay awards were not excessive, it expressed concerns about the bonus scheme as a whole.

Pirc also raised questions over the judgement of the remuneration committee at Stagecoach, which will hold its AGM next week. Shares closed down 2.6 per cent, or 6.4p, at 238.3p.

More broadly, the FTSE 100 index recovered from early losses to close the day up 7.05 points at 5,357.63 as news filtered though that ratings agency Fitch had left the US’s credit rating unchanged at AAA status.

A downgrade by rival agency Standard & Poor’s triggered a bloodbath on world markets earlier this month.

The upbeat news helped to overcome fresh fears over the eurozone debt crisis, after figures showed Germany’s powerhouse economy grew by only 0.1 per cent in the second quarter, down from 1.3 per cent in the previous three months and below forecasts for a 0.5 per cent increase.

Atif Latif, director of trading at Guardian Stockbrokers, said: “These German figures bring the economic situation in the eurozone into question yet again.

“German economic growth has effectively stalled, contrary to what economists were expecting and now is trading at levels we have not seen for a while. This brings the question of viability of Germany being able to be more involved in the European Union bail-out to support weaker economies.”

The latest downbeat eurozone news put further pressure on banks and mining stocks, still unsettled by last week’s sovereign debt fears and speculation over France’s leading banks.

Miner Vedanta Resources was among the biggest losers, down 3 per cent, or 42p, at 1,383p, while copper miner Antofagasta was off 36p at 1,228p.

Barclays fell nearly 1 per cent, or 1.8p, to 181.6p, while Royal Bank of Scotland eased 0.5p to end the day at 25.7p.

Shares in social housing group Mears rose 6 per cent to 276.8p after it unveiled underlying pre-tax profits up 7 per cent at £14m and a 13 per cent hike in the dividend to 2.15p. Mears – whose clients include Edinburgh and Glasgow councils – said it had a war chest of £85m for acquisitions.

Edinburgh-based newspaper distributor and airline services provider John Menzies was the stand-out performer among the Scottish stocks after it hiked its interim dividend by 40 per cent to 7p following a rise in profits.

Scottish Enterprise continued to reduce its stake in Dundee-based cash machine advertising software firm I-Design, selling 50,000 shares to take its holding down to 831,500, or 5.9 per cent. The agency sold 200,000 shares last week and 10,000 in July. I-Design closed flat at 47.5p.

Caroline Nish, wife of chief executive David Nish, spent £51,300 buying 25,000 shares in Edinburgh-based insurance and pensions giant Standard Life at 205.2p each. The stock closed up 6.2p at 212.4p.

Her purchase came a day after chief financial officer Jackie Hunt bought 10,193 shares for £19,999, or 196.2p each.