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London close: Stocks finish flat as markets digest US shutdown, data

Tue, 01st Oct 2013 16:25

Stocks in the UK finished broadly flat on Tuesday as investors gave a subdued reaction to the news of the first partial US government shutdown in 17 years.Indices across Europe and the States however edged higher today, with London's FTSE 100 bucking the trend given some sharp falls in the heavyweight mining sector on the back of falling metals prices. Manufacturing figures across the globe also came in mixed today with activity growth picking up in the US, remaining stable in the Eurozone, and slowing down in the UK and China.The FTSE 100 finished just 2.21 points lower at 6,460.01, marking a fresh one-month low; the last time the index closed lower was on August 30th, when it ended the session at 6,412.93.Brenda Kelly, Senior Market Strategist at IG, said that downside was limited today "since the congressional capers and the potentially negative effects on the health of the US economy are not exactly conducive to tapering of quantitative easing".Meanwhile, concerns over politics in Italy eased temporarily as Prime Minister Enrico Letta rallies up support ahead of a confidence vote on Wednesday. Angelino Alfano, the secretary of Silvio Berlusconi's PdL, said today that the centre-right party should back Letta in tomorrow's vote.US shutdown, debt ceiling in focusThe US Senate last night voted down a House of Representatives-passed bill that had called for a one-year delay in President Barack Obama's flagship 'Affordable Care Act', something that the Democrats said they would have never agreed to.As the start of the new fiscal year begins in the States some 800,000 federal employees will be placed on unpaid leave and sent home as the US government is forced to shut down non-essential agencies. The last time there was a government shutdown was back in the mid-90s.Economists are now trying to figure out what effect this will have on the US economic outlook after Obama said a shutdown would throw a "wrench" into the recovery and have a "real impact on real people right away". Moody's believes that a three-to-four-week shutdown could shave as much as 1.4 percentage points off of fourth-quarter gross domestic product growth.FTSE 100: Miners, Unilever provide a dragPrecious metals producers Fresnillo and Randgold were the worst performing stocks on the in afternoon trade as a political stalemate in the US prompted a reduction in risk appetite. Falling commodity prices and gloomy comments on gold from Fitch were also weighing on sentiment, as the ratings agency said that a rebound in gold prices is unlikely with the unwinding of quantitative easing.Anglo American, Glencore Xstrata and Rio Tinto were all also firmly lower. Consumer products group Unilever was also a heavy faller after markets reacted to a surprise trading update after the close last night which said that the company witnessed a weakening in the market growth of many emerging countries in the third quarter. The company is now guiding to organic growth of just 3-3.5%, well below analysts' forecasts.Other consumer staples stocks - amongst which are some who also have substantial exposure to emergng markets - including SABMiller, Diageo, Reckitt Benckiser, Coca-Cola HBC and Imperial Tobacco were also lower today. Budget airline easyJet was a high riser today after analysts at Citigroup said they expect full-year profits to be "near the upper-end of previous guidance". The company said in July that pre-tax profit would be between £450m to £480m; Citi's forecast is £474m.Plumbers merchant Wolseley gained after saying it experienced a year of "solid progress in varied markets" as it saw headline profits more than double in the year to July 31st due to lower impairments and exceptional items. The company also raised its dividend by a tenth and revealed a £300m capital return to shareholders via a special dividend and share consolidatioBanking peers Barclays and RBS were in demand, along with other financials including Aviva, Prudential and London Stock Exchange.FTSE 250: ITE Group boosted by positive updateConference and exhibition organiser ITE Group was a strong riser after it said it expects to reveal stronger annual revenue after positive trading conditions in most of its overseas markets during the fourth quarter. Also on the up was engineering giant Kentz Corporation; the group has scored a contract to provide commissioning and start-up services to Bantrel Co. Property investment and development business St. Modwen Properties rose after it said it had continued to perform strongly since the half year buoyed by a strengthening housing market. The company also said it remains confident of hitting full-year targets.FTSE 100 - RiserseasyJet (EZJ) 1,318.00p +3.13%Wolseley (WOS) 3,296.00p +3.10%William Hill (WMH) 415.50p +3.10%Prudential (PRU) 1,185.00p +2.95%Aviva (AV.) 408.10p +2.85%Royal Bank of Scotland Group (RBS) 368.30p +2.33%GKN (GKN) 349.50p +2.19%Travis Perkins (TPK) 1,685.00p +2.12%Rolls-Royce Holdings (RR.) 1,134.00p +1.98%London Stock Exchange Group (LSE) 1,567.00p +1.95%FTSE 100 - FallersFresnillo (FRES) 924.50p -4.98%Aggreko (AGK) 1,541.00p -3.93%Unilever (ULVR) 2,358.00p -3.36%SABMiller (SAB) 3,055.00p -2.82%Randgold Resources Ltd. (RRS) 4,338.00p -2.54%Anglo American (AAL) 1,484.50p -2.21%British American Tobacco (BATS) 3,204.00p -2.21%Imperial Tobacco Group (IMT) 2,237.00p -2.19%Glencore Xstrata (GLEN) 330.50p -1.84%Coca-Cola HBC AG (CDI) (CCH) 1,825.00p -1.35%FTSE 250 - RisersDaejan Holdings (DJAN) 4,200.00p +7.28%ITE Group (ITE) 289.00p +6.33%Workspace Group (WKP) 481.00p +5.95%Oxford Instruments (OXIG) 1,330.00p +5.56%Countrywide (CWD) 550.00p +4.76%Regus (RGU) 190.60p +4.73%Big Yellow Group (BYG) 460.00p +4.55%Enterprise Inns (ETI) 151.00p +4.50%Grainger (GRI) 181.00p +3.55%TalkTalk Telecom Group (TALK) 250.00p +3.48%FTSE 250 - FallersAfrican Barrick Gold (ABG) 154.50p -5.79%Polymetal International (POLY) 626.50p -4.20%Hochschild Mining (HOC) 174.50p -3.70%Kazakhmys (KAZ) 256.70p -3.50%Perform Group (PER) 540.50p -3.48%BBA Aviation (BBA) 295.90p -2.98%Evraz (EVR) 125.00p -2.34%De La Rue (DLAR) 972.50p -2.11%Tullett Prebon (TLPR) 339.00p -2.08%F&C Asset Management (FCAM) 96.30p -1.93%BC

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