At 2.35pm the FTSE 100 had eased by 78 points to circa 7030 (-1.1%). Uncertainty over the General Election, mixed earnings, a pull back from the ridiculous rally triggered by a change in spokesman on the Greek financial crisis and a temporary drop in UK GDP for the 1st quarter saw the whites of investors’ eyes , whilst they took some risk off the table. As we enter the last week of this colourless, bad tempered and tortuous General Election, I expect the FTSE 250 to surrender gains rather more vehemently that the FTSE 100, where 70% of earnings are Dollar related. The DOW opened up 35 points, but to date the FTSE has shown little inclination to rally to the cause on Wall Street’s back.
Though volumes were light losses stretched across the spectrum. Mining stocks were up an average of 2% apart from Rio which was down 0.5%. Banks were down an average of 0.75%, apart from Standard Chartered, which did not please its acolytes with a profit of $1.5 billion – down 3%, wiping most of yesterday 4% gain on rumours that new CEO Bill Winters may well join HSBC with repatriation plans.
Drugs were clattered – Astra down 3%, Glaxo -2% with Smith & Nephew and Shire both -1.5%. Even tobaccos were out of sorts – IMPS & BATS -2%. Media stocks after a terrific run on the rails were easier – Reed Elsevier and Pearson both -1.5%, Sky -1.2% and ITV -1%. BP was steady – up 0.25%. St James’s Place travelled and arrived after good numbers – -2.5%. Whitbread did much the same -3%. Carpetwright was up just 0.5%. US GDP tomorrow and the 2-day FED meeting will be very much on punters’ mind. However the election will continue to fuel volatility.