FTSE at 15-week low

Britain's top share index fell to its lowest closing level in 15 weeks on Tuesday as fears about a nuclear catastrophe in Japan prompted investors to shun risky assets. The FTSE 100 ended down for a fifth consecutive session, off 79.96 points, or 1.4 percent, at 5,695.28, wiping nearly 21 billion pounds ($33.86 billion) off the market. The index has declined almost 5 percent in March.
A crippled reactor at the nuclear complex in Fukushima exploded and sent low levels of radiation floating toward Tokyo, prompting some people to flee the capital and others to stock up on essential supplies. "Obviously the markets are dominated by the situation in Japan. With explosions at the Fukushima reactor, the newsflow is taking quite a negative turn with regards to contamination," said Ed Woolfitt, head of trading at Galvan Research.
"I think all newsflow and market moves in the short term are going to be driven by events there - whether or not they get it stabilised and calmed, or indeed whether it takes a turn again for the worse." Miners bore the brunt of the sell-off, though traders did see upside for the sector longer-term given its lacklustre start to the year and the need for Japan to rebuild.
London-listed uranium explorer Kalahari Minerals shed 11.6 percent on concerns over the future of the global nuclear power plant construction programme after the events in Japan. Luxury goods' companies were among other major fallers as Japan is one of their major markets. Burberry fell 1.2 percent, as investors sold the stock on concerns over Japanese demand for its goods.
Nomura analysts said the firm's licensing agreements in Japan in total generated around 17 percent of group core profit. ARM Holdings lost 1.5 percent as the chip designer suffered from disruption to production as a result of the Japan quake. Some analysts said the FTSE index's depressed levels could be seen as a buying opportunity.
"If the market heads towards 5,000, then it is getting towards a prospective PE (price-earnings ratio) of about 12 times, and that means that the yield of the market is getting to around 4 percent," said Jeremy Browne, an industrials analyst from Fairfax.
"Now, 10-year bond yields are 3.7 (percent) and cash returns are about 1/2 a percent. It can be a real sign for buying of the market when the yield of the equity markets gets greater than the 10-year bond yield market." He added that a move towards the 5,000 level could go hand in hand with a pick-up in M&A activity - "and when you get big cash deals, that will get the stock market rising".