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FTSE 100 falls back; tipped to continue south

January 16 2013, 1:39pm
FTSE 100 falls back; tipped to continue south

 

The FTSE 100 began its journey back south after a fortnight of buying that saw the top flight index climb as high as 6,133.

As had been predicted by City analysts earlier in the week, the benchmark index started to fall back from highs not seen since before the height of the financial crisis in 2008.

The New Year rally was sparked by a deadline day deal in the States to avoid the so-called ‘fiscal cliff’ of spending cuts and tax hikes worth US$600bn.

Since then, it has gone on a run despite a raft of poor economic data from around the globe, but analysts warned it would not last.

City Index analyst Sandy Jadeja reckons the decline will continue into next week.

“Breaking below 6100 which is what the index has done today suggests that we could follow the index lower in the coming days and likely into next week,” he said.

The Footsie slipped 33 points or 0.54% to 6,084, with Lloyds Banking (LON:LLOY) tumbling almost 4% down the leaderboard in the wake of a downgrade from Australian broker Macquarie Capital.

Miner ENRC (LON:ENRC) and cruise ship operator Carnival (LON:CCL) were the Footsie’s winners, both up around 2.8%.

Supermarket giant Tesco (LON:TSCO) lost over 1% after it was revealed horse meat was present in some of its beef burgers.

The food safety authorities in Ireland found horse DNA in 10 out of 27 products that were supposed to be beef burgers.

Xstrata (LON:XTA) and Glencore (LON:GLEN), close to agreeing a merger to create the world’s largest mining group, languished at the foot of the table, down more than 3.5% each.

Mobile giant Vodafone (LON:VOD) slid 1.9% on the back of a Deutsche Bank downgrade to ‘hold’, while alcoholic drinks heavyweight Diageo (LON:DGE) edged 0.4% lower after a downgrade from Société Générale.

Forbidden Technologies (LON:FBT) enchanted investors on AIM, up 17% on the back of the success of its video editing platform during the Olympics.

Widespread use of the technology during the Games boosted revenues in 2012, while sales growth exceeded the 50% predicted by analysts by “a respectable margin”.

FORScene, Forbidden’s flagship cloud-based video editing software, was used by NBC and YouTube for web video coverage of the Games, with thousands of hours of content handled by its software.

Tracking it north were Silence Therapeutics (LON:SLN), up 16%, and Xenetic Biosciences (LON:XEN), which shot up 35%.

Angle (LON:AGL) lost 14% after two days of huge gains that added more than 45p to the share price, taking it to 75p by Tuesday’s close.

The stock shot up 140% on Monday after a major breakthrough in Angle’s Parsortix cancer diagnostic test, which substantially extends the technology’s use.

It has been a busy few days for Angle, which got a shot in the arm yesterday from a US$286,226 settlement payment related to the sale of its portfolio company Acolyte Biomedica – another piece of the news that gave shares a leg-up.

 


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