WEDNESDAY MARKET CLOSE: Weak US growth hits FTSE

London’s benchmark share index skidded more than 1 per cent below the 7,000 mark after confidence was knocked by US figures showing that growth almost ground to a halt.

The US economy expanded at an annual rate of just 0.2 per cent in the three months to the end of March, official figures showed – battered by harsh weather, plunging exports and sharp cutbacks in oil and gas drilling. Economists had forecast growth of 1 per cent.

The news pushed the FTSE 100 index 84.25 points or 1.2 per cent lower to 6,946.28, having fallen by 73.5 points on Tuesday night following weak UK GDP figures.

Joshua Mahony, market analyst, IG, said: “A weak US GDP figure has fed through into Europe, with [Germany’s] Dax and the FTSE 100 smashing through key support levels.

“Prior to this, European markets were dealt a suckerpunch by Greek finance minister Yanis Varoufakis who expects to remain in charge of creditor negotiations, confounding rumours to the contrary.”

In the top flight the weakness among mining stocks continued after weaker copper output figures from Antofagasta. The Chilean miner slipped 18p to 784p and BHP Billiton eased 25.5p to 1,564p.

Retailers took up some of the slack as Next rallied as much as 3 per cent before closing up 120p at 7,285p after figures showed its sales grew 3.2 per cent in the 13 weeks to 25 April.

Shares in Barclays were almost 2 per cent lower after it announced additional provisions to cover the mis-selling of payment protection insurance and potential fines for alleged foreign exchange rigging.

Underlying profits were 9 per cent higher but shares still dipped 4.45p to 256.95p.

Cairn Energy announced the appointment of two new non-executive directors, Keith Lough and Peter Kallos, to its board. Shares in the Edinburgh-based group were 0.9p lower at 178.8p.