Britain's top share index ended slightly lower on Monday, as weakness in oil stocks outpaced firmer drugmakers, as the US House of Representatives approved a healthcare reform bill, and with miners also in demand. The FTSE 100 ended down 5.58 points, or 0.1 percent, at 5,644.54 after a volatile session which saw the index dip as low as 5,583.49.
It closed at its highest level since June 25 2008 on Friday. Energy stocks took the most points off the index, though pared some of their losses as the crude price came off lows from earlier in the day. BG Group, BP, and Royal Dutch Shell were off 0.8 to 1.8 percent. Cairn Energy, which on Tuesday reports full-year results, shed 1.4 percent.
Banks were weaker as Greece and Dubai debt matters resurfaced. Barclays, Standard Chartered and HSBC dropped 0.3 to 1.1 percent. European Union leaders seemed at odds over how or whether to offer assistance to Athens, setting the scene for a tense summit on March 25-26 and fuelling doubts over whether eurozone states will agree to any support package..
Meanwhile, state-owned conglomerate Dubai World is expected to propose a $26 billion debt restructuring plan to its creditors imminently, in a move seen as a test of the emirate's ability to honour commitments. "I think today as much as anything has been a pause for breath ahead of what should be a reasonably busy rest of the week, in terms of corporate announcements and then of course the budget on Wednesday," said Richard Hunter, head of UK equities at Hargreaves Lansdown.
A raft of blue chips are expected to announce their results or trading updates this week. Imperial Tobacco and insurer Legal & General will be on deck on Tuesday, followed by grocer Sainsbury on Wednesday and retailers Kingfisher and Next on Thursday.
Drugmakers were in demand after the passage of a bill by the US House of Representatives late on Sunday eased uncertainty for investors. Crucially, the US government will not impose drug price caps. AstraZeneca, GlaxoSmithKline and Shire rose 0.6 to 1 percent.
Buyers also came in for the miners which, along with metals prices, were off lows seen earlier in the session. Rio Tinto, Randgold Resources and BHP Billiton put on 0.8 to 1.6 percent. Technology firm Smiths Group topped the FTSE 100 risers chart, up 2.5 percent after the company bought Kansas City-based Interconnect Devices for $185 million in an all-cash deal.
ICAP shed 2.6 percent, topping the blue chip fallers list after the inter-dealer broker said it is to cut back its troubled stockbroking unit in a strategic climbdown forced by tougher than expected competition and dwindling trading volumes. Building materials supplier Wolseley lost 2.1 percent after saying it would remain cautious for the rest of the year and focus on controlling costs after seeing trading profit fall 34 percent in the first half.
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