Markets: Sound of sleigh bells heard in City

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TRADERS began to jingle their sleigh bells and whisper about a the traditional Christmas “Santa rally” yesterday as the Footsie continued to eye the 6,000-mark.

Despite London’s benchmark index closing down 16.24 at 5,929.61, the recent run of good form got the City talking about a possible further rally for shares.

David Jones, chief market strategist at IG Index, said: “The past month has already seen a 5 per cent rally for the FTSE 100 and, as volumes start to contract even further this time of year, it wouldn’t take that much of an odd move to launch an assault on the 6,000-mark before 2012 is out.”

However, concerns over the “fiscal cliff” of tax rises and spending cuts in the United States had investors rattled yesterday, with a lack of corporate news stoking the unease.

Gas producer BG Group dropped 18p to close at 1,047p after the FTSE 100 company unveiled existing director Chris Finlayson as its next chief executive, replacing the long-serving Frank Chapman. Canaccord Genuity analyst Gordon Gray warned some in the market could see an internal appointment as a “slight negative”.

Betfair was 3p lower at 761p after the bookmaker posted a 22 per cent slide in profits to £21 million in the six months to 31 October. Chief executive Breon Corcoran said the company had become too focused on international markets, where it had suffered setbacks in recent months due to increased regulation.

Johnston Press – the Edinburgh-based owner of The Scotsman, Scotland on Sunday and about 250 local newspapers in the UK and Ireland – climbed 5.4 per cent or 0.75p to 14.75p after house broker Panmure Gordon increased its target price on the stock to 18p from 12p.

NEW YORK: On Wall Street, the Standard & Poor’s 500 index ended its six-day winning streak last night, retreating as worries intensified that Washington’s “fiscal cliff” negotiations were dragging on with little progress.

The Dow Jones industrial average fell 74.73 points, or 0.56 per cent, to close at 13,170.72 while the broader S&P dropped 9.03 points, or 0.63 per cent, to finish at 1,419.45. The Nasdaq Composite Index lost 21.65 points, or 0.72 per cent, to end the day at 2,992.16.