Sharp sell-offs in Asia overnight, a weak dollar and jitters ahead of the US open have left the FTSE 100 deep inside the red this morning, with big falls for building materials group Wolseley and British Airways not helping.
The FTSE is down more than 100 points at 5664, a drop of around 1.9%. News just out that US retail sales slumped 0.6% last month is intensifying pressure on equity markets. Economists had been expecting a rise and the news has put US futures under further pressure pointing to more FTSE losses this aftenoon.
Wolseley is the top faller in London, down 7.7% to 542p after Goldman Sachs analysts cut their recommendation on the shares to "sell" from "neutral". They dropped their price target to 565p from 775p. They expect earnings to continue to fall at Wolseley as construction markets in both the US and Europe weaken.
British Airways is taking a hit along with other airlines on continued concerns about rising fuel prices thanks to the oil price holding near its recent record high. The airline is down 5.2% at 230p, while midcap peer Easyjet is down 5.4% at 394p.
Another notable faller today is mining company Kazakhmys, down 4.7% at £16.97, after it told the market it had not received a taekover proposal from rival Eurasian Natural Resources. Speculation had driven the shares up 16% yesterday.
WM Morrison Supermarkets failed to inspire investors with its news of record 2007 profits in chairman Sir Ken Morrison's final set of results. The shares are currently down 2.8% at 287p.
Among the few bluechips on the way up, Unilever is the top riser on the FTSE 100, gaining 2% on the back of upbeat news from rival Nestle. The swiss food giant has raised its growth outlook for 2008 saying it expects to match last year.
Energy companies have been boosted by renewed talk of interest in Scottish & Southern from RWE. Scottish & Southern has declined to comment but the speculation in the market has lifted its shares 1%. International Power is up 1.3%, National Grid is up 0.8% and United Utilities is up 0.2%.
Further down the market, 2waytraffic, that owns the rights to TV quiz show Who Wants to be a Millionaire?, is down 4.7% despite the news Sony Pictures is buying the the Dutch company for £137.5m.
2waytraffic says it has agreed to a takeover offer from the subsidiary of the Japanese electronics giant Sony, which includes £114.3m for the company's shares and £23.2m in earn-out agreements for 2waytraffic's four founders if they stay on until 2011.
