Morning:
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In theory the appointment of Bob Diamond to the top job at Barclays is a buy signal — a sign that the good times are poised to roll again.
So maybe someone should tell the stockmarket.
The FTSE was on the slide again today as yesterday's sell-off continued, bringing to an end a mini-bull run.
Diamond — the swashbuckling, all-action Yank with the bulging pay-packet — is expected to drive Barclays profits higher with a combination of savvy and risk-taking.
His becoming the next chief executive of Barclays was supposed to indicate that the banking crisis is truly over.
Fears clearly remain. Barclays led the Footsie losers, down 11p to 303p with a downgrade by analysts at Bernstein to “market-perform” from “outperform” not helping sentiment.
Royal Bank of Scotland followed, losing 1p to 45p.
G4S, Shire, Diageo, Kazakhmys, Segro and Rexam all went ex-dividend, falling in the process and taking the market with them.
The FTSE index gave up 38.14 points to 5369.68.
The sell off was exacerbated by renewed worries about the PIGS (Portugal, Italy Greece and Spain) — Portugal in particular — but the main theme today was tedium.
A measly 194 million shares were traded by mid morning — feeble stuff.
Twiddling his thumbs and contemplating lunch, one trader said: “It's dull, quiet. I'm bored.
“We are heading into reporting season so you'd expect things to start picking up. But the markets are a bit spooked, a bit jittery.”
Business won't improve until there is greater clarity about the state of the economy, he reckoned, but for now trading is seasonal, which is to say: very light.
“Some people will tell you it is the end of world,” said a rival trader. “It's not. It's September.”
Reheated, unsubstantiated and widely-circulated gossip that a predator was circling Invensys fell flat today.
Shares in the engineering group, lazily pumped up yesterday, fell 9.1p to 260.1p today, removing nearly all of Tuesday's gains.
The blue-chip risers included the real estate companies, after research by Barclays Capital presented a positive picture of the state of the industry and mortgage lender Halifax posted a surprise uptick in August house prices.
Land Securities added 3p to 644.5p, Hammerson 2.9p to 377p and British Land 2.2p to 477p.
Vodafone shares, trading at barely above a quid in January 2009, have since had a splendid run.
Today the market reaction to the mobile phone giant's overnight deal to flog its Chinese arm for £4.3 million was muted.
Goldman Sachs said in a note that it regards the deal as an “important” indication of management's intention to do what investors want — sell minority stakes around the globe to simplify its portfolio.
But Goldman reckons that Vodafone shares are no better than a hold just for the moment. The stock gave up 1.85p to 158.05p.
There was minor mirth to be had in a stockmarket announcement by defence firm Chemring, which felt the need to report that it has endured a fire at a “large-calibre ammunition assembly building” in Belgium. No one was hurt. An investigation was launched. The shares fell 24p to 2768p.
The rumour mill turned its attention, not for the first time, to Centrica. There was vague talk of a bid, edging the shares up 5.5p to 336.6p.
“It's a dippy market and I'll believe anything,” said one trader, who admitted he was barely coping with a monstrous hangover. “I'd be sacked if I wasn't the boss,” he chirped.
Thoughts also turned to drink at the spread-betting houses.
Pub chain Wetherspoons is expected to break the £1 billion sales barrier when it reports on Friday, despite warnings of subdued customer expenditure since the end of the World Cup.
Changing opening times from 9am to 7am to catch the morning coffee crowd has helped boost Weatherpoons' performance say the spreaders, who reckon that the share price will continue its recent rise after hitting year-lows of 378.70p in July.
The lads at Spreadex have a December-based contract with a spread of 439.1p-444.6p.
Today the stock lost 1.9p to 438.7p.
