The London market extended its losses on Wednesday as jitters about a UK exit from the EU increased.
The FTSE 100 Index was 85 points adrift at 5877 as business leaders queued up to urge the British public to vote to stay in the EU in the planned referendum in June.
Budget airline Ryanair called for a big "in" vote, saying the UK's involvement in EU moves to deregulate the airline industry and so-called "open skies" had transformed UK tourism and job prospects.
Chief executive of budget airline Ryanair (LON:RYA), Michael O'Leary, said: "As the UK’s largest airline, Ryanair is absolutely clear the UK economy and its future growth prospects are stronger as a member of the EU than they are outside.
"Leaving Europe won’t save the UK money or red tape because like Norway it will still have to contribute to Europe and obey its rules if it wants to continue to trade freely with Europe, so it’s clear UK voters should vote Yes to Europe."
Heavyweight investor Guy Hands, the British founder of European private equity firm Terra Firma, said the UK appeared to be "pulling up the drawbridge" to Europe and hoping the challenges of a global world would go away.
Meanwhile, HSBC (LON:HSBA) forecast that sterling could tumble by a fifth to a three-decade low if the UK left the EU. It came after two UK trade organisations, the EEF and the CBI, both warned against an exit.
On the economic front, figures from the British Bankers Association showed a 38% rise in gross mortgage borrowing to £13.6bn in January against a year ago, the highest since mid-2008.
Housebuilders also offered evidence of the strength of the UK housing market as Barratt Developments (LON:BDEV) increased its profits by 40.3% to £295mln on a 19% increase in revenue to £1.87bn. Barratt shares rose 12p to 574p.
Barratt's rivals rallied on the news, with Persimmon (LON:PSN) up 41p to 2070p, Bovis Homes (LON:BVS) gaining 16p to 896.5p and Redrow (LON:RDW) putting on 3p to 415.5p.
Hays (LON:HAS) slipped 8.8p to 115.4p as the recruitment agency group warned that growth slowed toward the end of the first half in the UK and Australia as increased global uncertainty hit sentiment.
Elsewhere, print software and supplies group Grafenia (LON:GRA) warned trading had not picked up and results this year were set to fall well short of market forecasts, knocking its shares by 16% to 8.5p.
First Property Group (LON:FPO) pared losses to stand 0.88p up at 46.12p on news that the limited partners in UK Pension Property Portfolio LP, a fund managed by the group which was due to mature on 5 February 2017, have agreed to extend its life by five years to February 2022.
Premier African Minerals (LON:PREM) saw shares advance 6.9% to 0.78p as it revealed financier Darwin has converted the remaining eight loan notes worth £200,000 into company shares.
LONDON OPEN
Falling crude oil prices and more warnings about a potential UK exit from the EU combined to send top-flight shares down on Wednesday.
The price of a barrel of Brent crude dipped 1.2% to US$32.89 and US light crude was 2.3% off at US$31.15.
The fall came on the back of remarks on production levels from both Saudi Arabia and Iran.
Markets were pricing in a host of negatives regarding OPEC disagreement, no production cuts and the likelihood that US shale producers may re-enter the market as soon as the crude price recovers to US$40 or above.
In London, there were fresh warnings about the potential damage a UK exit from the EU could do to the British economy. Sterling dropped below US$1.40 for the first time since 2009 on the concerns.
The main body representing Britain's manufacturers, the EEF, said the "out" campaign to persuade Britain to leave the EU had no tangible benefits to show voters and could only offer "an abyss of uncertainty and risk".
Meanwhile, access to the EU's single market was London's single biggest strength, according to 95% of more than 200 of the city’s business leaders responding to the latest CBI/CBRE London Business Survey
On the economic front, figures from the British Bankers Association showed a 38% rise in gross mortgage borrowing to £13.6bn in January against a year ago, the highest since mid-2008.
Housebuilders also offered evidence of the strength of the UK housing market as Barratt Developments (LON:BDEV) increased its profits by 40.3% to £295mln on a 19% increase in revenue to £1.87bn.
Barratt's rivals rallied on the news, with Persimmon (LON:PSN) up 37p to 2066p, Bovis Homes (LON:BVS) gaining 0.5p to 551.5p and Redrow (LON:RDW) putting on 1.5p to 414p.
Hays (LON:HAS) slipped 6.7p to 117.5p as the recruitment agency group warned that growth slowed toward the end of the first half in the UK and Australia as increased global uncertainty hit sentiment.
Elsewhere, print software and supplies group Grafenia (LON:GRA) warned trading had not picked up and results this year were set to fall well short of market forecasts, knocking its shares by nearly a quarter to 7.62p.
First Property Group (LON:FPO) backtracked 0.25p to 45p on news that the limited partners in UK Pension Property Portfolio LP, a fund managed by the group which was due to mature on 5 February 2017, have agreed to extend its life by five years to February 2022.
MARKET PREVIEW
London’s blue-chip stocks are expected to start today’s trading slightly lower as oil prices continue to pull the markets back and forth.
Having started the week positively, crude oil price had slumped by Wednesday morning - with Brent losing 5.6% to $32.85 and West Texas Intermediary down 7% to $31.20.
The drop off in crude was seen among the main factors in Wall Street’s pull back last night.
Closing at 16,431 the Dow Jones shed 188 points, or 1.14%, on Tuesday meanwhile the S&P 500 and Nasdaq gave up 1.25% and 1.47% respectively.
In Asia, Japan’s Nikkei dipped 0.85% to 15,915 while Hong Kong’s Hang Seng was 1.3% lower.
The Shanghai Composite, meanwhile, actually rose 0.7% to 2,924.
But, Australia’s ASX 200 was down 104 points, just over 2%, trading at 4,875.
In London, spreadbetting and CFD group IG Markets sees the FTSE 100 slightly lower. It is calling the blue-chip benchmark 5,941 to 5,946.