TUESDAY MARKET CLOSE: Lloyds drags FTSE lower
The FTSE 100 was also in the red, giving back the gains of the previous session to close 52.69 points or 0.8 per cent lower at 6,570.17. It was dragged down by financials, which also suffered a flow of bad news from Barclays.
Shares in Lloyds slipped 3.5 per cent to 74.65p after a number of brokers said the government had shown good timing by selling billions of shares at a time when the lender was looking overvalued in relation to its peers. The £3.2 billion sale netted the taxpayer around £61 million compared to the average buy-in price during Lloyds’ bailout. On a book-value basis, the paper gain was £586m.
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Hide AdAfter facing a £50m fine by the financial regulator for breaching market rules in respect of its 2008 Middle East capital raising and releasing a downbeat comment on trading on Monday, Barclays heaped further woe on investors as it revealed it would have to refund thousands of customers following an error. Its shares were down 2 per cent or 6.4p at 299p.
Temporary power supplier Aggreko was the biggest faller in the top flight following a hefty downgrade from broker Credit Suisse. Shares in the Glasgow-based group slumped more than 4 per cent to 1,580p after the bank changed its rating from “neutral” to “underperform” and slashed its price target and earnings forecasts for the company.
The best performing stocks were in the utilities sector, with Severn Trent and United Utilities both around 2 per cent higher at 1,792p and 703p respectively as speculation of bid activity in the sector re-emerged. The stocks also benefited from their perceived safe haven status as traders sought to bank recent profits ahead of the Fed’s long awaited announcement on possible tapering this evening.
NEW YORK: