Market Report: The All-share hits 50 – but it's in no mood to party
If the FTSE All-share looked down in the dumps yesterday, slumping to its lowest level since January as traders digested the latest worries over Europe, you can blame it on a mid-life crisis. For Britain's broader index celebrated its 50th birthday yesterday. The All-share index launched on 10 April 1962, was enhanced with the addition of the blue chip FTSE 100 in 1984 and boosted by the addition of the FTSE 250 in October 1992.
When England won the World Cup in 1966, the FTSE All-share closed at 96.86 points. When man first landed on the moon in 1969, it had risen to 131.23. By Black Monday in 1987, it closed at 1,074.58. Fourteen years later, when September 11 saw the FTSE 100's biggest daily fall, the All-share was 2,311.48, while Kate and Wills' wedding last year saw the FTSE All-share at 3,153.03, the FTSE Group reported.
But even toasting five decades of tracking the London equity market wasn't enough to give investors any cheer: the FTSE All-share closed down 2 per cent at 2,911.3 yesterday, while the FTSE 100 dropped 2.24 per cent to end at 5,595.6. Both were marked down on a cocktail of worries – eurozone jitters about Spanish debt, soaring inflation in China, and the City's first trading opportunity to respond to Friday's US jobs figures. They showed that American firms added only 120,000 jobs in March, the fewest in five months and less than forecast.
Barclays dived 5.9 per cent or 13p to 206.3p, followed down by Lloyds Banking Group, off 5 per cent at 29.8p, and Royal Bank of Scotland,which shed 4 per cent to 24.72p. The commodities giants also weighed on the blue chip index, with Vedanta Resources, down 80p at 1,155p, taking the wooden spoon, while Kazakhmys fell 53.5p to 853p.
Bucking that downward drift was Randgold Resources. The yellow metal miner saw its shares battered last week as investors worried about the impact of the military coup in Mali. But yesterday all that glistered was gold, after a deal was struck to end the coup, and Randgold's shares leapt 270p to 5,425p.
Elsewhere in the market came evidence that not everyone was cashing in on the boom for online pictures and video. A day after Facebook splashed out $1bn (£632m) for Instagram, the US start-up that allows friends to share photos, the video search engine Blinkx fell by nearly a quarter.
Traders punished the London-listed Blinkx after it admitted annual revenues, up 72 per cent at $114m, would fail to meet analysts' expectations. The shares dived to a two-year low of 40p before settling at 41.25p, down 21 per cent.
Suranga Chandratillake, the company's chief executive, blamed a "challenging economic climate" and insisted that Blinkx's sales growth still "outperformed the aggressive growth of the online video advertising industry by over 80 per cent". But the shares are now down more than two-thirds since their peak last autumn when they were above 150p.
FirstGroup, the transport giant, was another bruised stock. It has been stuck in reverse gear for more than a month now, after a string of downgrades as it admitted margins at its British bus division would drop by more than a third this year.
Deutsche Bank has already downgraded the stock. Citigroup and Barclays Capital followed suit yesterday, slashing their recommendations from buy to neutral or, as BarCap's analysts esoterically put it, from overweight to equal weight.
Both trimmed their target prices, with a dramatic slash from 435p to 214p by Citigroup. In response, the shares crashed more than 7 per cent, or 15.4p, to 198p.
On the upside, the bid target Ithaca Energy was a big talking point as shares endured a roller-coaster day, hitting a record high of 211p amid talk that shareholders will agree on a sale imminently, before ending the day down 5p at 195p amid the general sell-off. The Canadian group, which has oil-drilling interests in the North Sea, first said in January that it had received an approach. The gossip is that as many as half a dozen bidders have emerged since. But they don't have to show their hand under the UK Takeover Panel rules because Ithaca is based in Canada, with a secondary listing in London.
Pay-TV giant BSkyB was another rare riser, up 18.5p or 2.9 per cent at 654p, as analysts said last week's sell-off looked overblown. The shares slumped after Sky News admitted it had authorised a journalist to hack into emails on two occasions. Sky, which is 39 per cent owned by Rupert Murdoch's News Corporation and already faces a "fit and proper" test by the regulator Ofcom, insisted the hacking was "in the public interest".
Meanwhile, Trinity Mirror fell 2 per cent or 0.75p to 36p. Legal & Genera l slashed its stake to below 5 per cent ahead of next month's annual general meeting, where the chief executive, Sly Bailey, faces a vote on her remuneration. The shares are now down more than two-thirds since their peak last autumn.
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