Fourth straight dip for the FTSE
BRITAIN’S top share index closed below 5,400 for the first time this year yesterday, extending its falls to a fourth straight session as jitters over turmoil in the Eurozone dominated the market backdrop.
Weaker banks were the biggest drag on sentiment, reflecting exposure to Eurozone debt as worries about Spanish banks and the country’s increasing financing costs were added to the political paralysis gripping Greece.
At the close, the FTSE 100 index was down 66.87 points, or 1.2 per cent at 5,338.38, its lowest close since November 2011 and having hit an intra-day low of 5,309.75.
Its losses for the week extended to 4.3 per cent. Investors were braced for more weeks of uncertainty in the Eurozone, with a second parliamentary election in Greece scheduled for 17 June likely to increase prospects of the country quitting the single currency and the subsequent spillover into other countries, notably Spain.
Spain’s medium-term borrowing costs rose sharply yesterday to around five percent in an auction of three and four-year bonds.
In Madrid, Bankia shares fell 14 per cent, having lost as much as 30 per cent earlier after Spain’s El Mundo newspaper said customers at the troubled lender had withdrawn more than €1bn over the past week.