FTSE declines for second consecutive day
Stocks in London slid for a second successive day today, resulting the in the FTSE 100’s largest two day decline in 10 months. The index was down 0.63 percent on the day as investors became increasingly skeptical about the longevity of America’s current monetary easing policies.
Investors have been on edge since comments from Ben Bernanke earlier in the week suggested that the Federal Reserve would withdraw from their bond purchasing program if solid signs of economic growth were visible and set the US economy on the path to long term recovery.
The US commerce Department released their report this afternoon showing that orders for durable goods had increased by 3.3 percent in April, more than double the expected 1.5 percent. This left investors with a decision to make; was this grounds for getting into the markets or was it the tell-tale sign of economic growth that the Federal Reserve was looking for? Investors sided with the latter.
The FTSE declined by 42.45 points, or 0.63 percent, to 6654.34. Just 20 of the 100 constituents made advances, while the remaining majority of 80 retreated. Whilst this was an improvement on yesterday’s decline of 2.1 percent, the week most certainly ended on a sour note after threatening to hit all time highs earlier in the week.
Shire PLC lead the index in gains with an advance of 1.59 percent after a transaction of its own shares. The specialist medicinal provider purchased more than 35,000 of its own ordinary shares at 5 pence each.
Smiths Group PLC saw its stock increase in value by 20 pence per share to 1355p, a rise of 1.5 percent. The group announced better year on year revenue for the quarter and said that it was on course to meet financial expectations for the year.
Severn Trent PLC advanced by 29 pence per share, or 1.42 percent, on the back of takeover speculation. Investors in the company have made it clear to bidders that they would be willing to listen to offers in the region of £23.00 per share. The stock closed at £20.71.
Eurasian Natural Resources Corp PLC made the biggest decline of the day in London, shedding 10.70, or 4.03 percent, after continued talk of it being taken private.