Markets: City struck with negative outlook

Broker downgrades accounted for the biggest falls in London’s top flight as the Footsie drifted lower on a stream of negative economic news.

Outsourcing firm Capita was the worst casualty, down 3.7 per cent at 740p after two analysts dropped their rating on the stock following an investor day.

Seymour Pierce’s Caroline de La Soujeole was left less than enthused by the presentation, saying there was not enough news to justify raising the price target.

“We were disappointed to hear that international expansion does not feature greatly in the company’s plans,” she said.

Scottish temporary power provider Aggreko was 3.4 per cent lower after HSBC cut its rating from “overweight” to “neutral”. It shed 79p at 2,240p.

But among those finding favour was Marks & Spencer, which topped the risers’ board after JP Morgan Cazenove recommended the shares as a medium term investment. The broker said the potential profit growth was not priced into M&S, sending the stock up 3.2 per cent or 11.8p at 381.3p.

Retailers also benefited from British Retail Consortium data showing a sales rebound on the high street last month. Next lifted 30p to 3,571p, while in the second tier Debenhams gained 2.2p to 107.2p and Argos-parent Home Retail Group added 3p to 97.3p.

Aberdeen Asset Management was 4.6p higher at 325.5p after Morgan Stanley raised its price target for the shares, naming it a “top pick” in a sector where it believes firms must try to win market share to succeed.

The FTSE 100 was down 31.5 points at 5,810.3 in the wake of disappointing UK industrial, manufacturing and trade figures. Sentiment was not helped by cuts to global economic forecasts by the IMF.

NEW YORK: Wall Street fell last night, led by losses in technology after brokerage downgrades of Intel and other major companies as worries increased about third-quarter US earnings.

The Dow Jones industrial average fell 110.20 points, or 0.81 per cent, to end the day at 13,473.45 while the broader Standard & Poor’s 500 Index slid 14.40 points, or 0.99 per cent, to finish at 1,441.48. The Nasdaq Composite Index dropped 47.33 points, or 1.52 per cent, to close at 3,065.02.