London close: Mixed data, weak earnings pull FTSE below 6,900

A mixed batch of economic data and weak corporate earnings gave investors the excuse to take profits on Tuesday, as markets continued to retreat from their recent record highs.

London's FTSE 100, which had started the day in positive territory, swung sharply into the red by mid-morning and extended losses into the close.

The Footsie finished the day down 51.51 points (-0.74%) at 6,889.13, after being unable to top an intraday all-time record high of 6,974.26 reached on Monday. This was the index's first close below the 6,900 mark since 19 February.

"Equity markets have balked at the idea of setting new highs and instead chosen to limply give up early morning gains," said analyst Alastair McCaig from IG.

Ongoing fighting in eastern Ukraine between government troops and pro-Russian rebels was also weighing on sentiment on Tuesday, with tensions still high following the ceasefire agreement two weeks ago.

Ukraine's foreign minister Pavlo Klimkin reiterated the need to "fully close down" the border between Ukraine and Russia, and said that the normalisation of the relationship between the two nations requires Moscow returning sovereignty over Crimea to Kiev.

Economic data mixed

German retail sales jumped 2.9% in January after a revised 0.6% gain in December. This was well ahead of the 0.4% increase expected by analysts.

However, the euro weakened after Eurozone producer prices fell at an annual rate of 3.4% in January, with deflation worsening from the 2.6% fall registered in January. This was the largest decline since November 2009.

Meanwhile, the Markit/CIPS UK construction purchasing managers’ index rose to a four-month high of 60.1 in February from 59.1 in January, ahead of the 59.0 consensus forecast.

Earnings disappoint, Barclays drops

Shares in Barclays fell after the bank set aside a total of £1.25bn for provisions to cover litigation costs related to ongoing probes into mis-selling PPI and rigging foreign exchange rates. The news came as Barclays reported a pre-tax loss of £532m for the fourth quarter.

Commodities trader and mining group Glencore also dropped after posting a 2% decline in operating profits in 2014 and slashing its investment budget for this year.

Builders merchant Travis Perkins was among the fallers after disappointing with a cautious outlook for the UK housing market.

Equipment rental outfit Ashtead also underwhelmed despite saying it expected full-year results to be ahead of its previous expectations after a strong third quarter.

In contrast, house builder Taylor Wimpey was trading higher after doubling its dividend payment, unveiling 54% operating profit growth in 2014 and enjoying better-than-expected trading in the New Year.

Shares in RSA Insurance were under the weather after Bernstein analysts lowered their rating on the stock from ‘outperform’ to ‘market perform’, while Intertek was downgraded by HSBC from ‘overweight’ to ‘neutral’.

Smith & Nephew declined after announcing the purchase of EuroCiencia Colombia, its sole distributor for orthopaedic reconstruction, trauma and sports medicine products in Colombia.

Market Movers

techMARK 3,138.58 -0.54%
FTSE 100 6,889.13 -0.74%
FTSE 250 17,146.02 -0.60%

FTSE 100 - Risers
Tullow Oil (TLW) 364.80p +2.10%
Taylor Wimpey (TW.) 147.90p +2.07%
Morrison (Wm) Supermarkets (MRW) 202.00p +1.61%
Hargreaves Lansdown (HL.) 1,171.00p +0.95%
SABMiller (SAB) 3,676.00p +0.62%
Sainsbury (J) (SBRY) 273.70p +0.62%
British Land Co (BLND) 850.00p +0.59%
BP (BP.) 448.60p +0.44%
Coca-Cola HBC AG (CDI) (CCH) 1,164.00p +0.43%
Centrica (CNA) 247.50p +0.41%

FTSE 100 - Fallers
Smith & Nephew (SN.) 1,131.00p -5.67%
Travis Perkins (TPK) 1,944.00p -4.00%
RSA Insurance Group (RSA) 420.20p -3.25%
Barclays (BARC) 254.30p -3.22%
International Consolidated Airlines Group SA (CDI) (IAG) 556.00p -3.14%
Glencore (GLEN) 291.20p -3.11%
ITV (ITV) 221.80p -2.63%
Sports Direct International (SPD) 669.50p -2.62%
United Utilities Group (UU.) 920.50p -2.59%
TUI AG Reg Shs (DI) (TUI) 1,140.00p -2.56%

FTSE 250 - Risers
Pace (PIC) 363.00p +8.13%
Fisher (James) & Sons (FSJ) 1,250.00p +7.76%
Rotork (ROR) 2,600.00p +6.30%
Vesuvius (VSVS) 499.70p +5.20%
Hunting (HTG) 488.40p +3.26%
Laird (LRD) 352.50p +3.22%
Vedanta Resources (VED) 601.00p +3.18%
Wood Group (John) (WG.) 675.00p +2.66%
Amec Foster Wheeler (AMFW) 901.50p +2.33%
Electrocomponents (ECM) 237.50p +2.19%

FTSE 250 - Fallers
Moneysupermarket.com Group (MONY) 243.40p -8.98%
Afren (AFR) 9.10p -8.18%
Regus (RGU) 221.80p -8.16%
Dunelm Group (DNLM) 876.50p -6.36%
Lonmin (LMI) 146.60p -5.11%
Tullett Prebon (TLPR) 335.00p -4.83%
Just Eat (JE.) 352.60p -4.29%
Ocado Group (OCDO) 357.00p -4.26%
IMI (IMI) 1,313.00p -3.74%
Playtech (PTEC) 732.00p -3.68%