FTSE closes flat as low confidence and poor construction data bites
BRITAIN’S top share index closed flat yesterday, underperforming most European bourses as a swathe of downbeat domestic data outweighed optimism about crisis-hit Spain and Greece.
British construction activity shrank last month, and confidence about the next year fell to its lowest in almost four years, as the British Chamber of Commerce said that growth in the next two years will be weaker than previously thought.
The downbeat news provided a blow to finance minister George Osborne ahead of today’s Autumn Statement, in which he is expected to defend an austerity plan that has failed to deliver a strong recovery.
“I think people are generally very cautious on the UK ahead of tomorrow’s Autumn Statement. People are just adjusting portfolios today, I wouldn’t think people are taking a view on direction going into that statement,” Ioan Smith, strategist at Knight Capital, said.
“People will tend to trade moves, rather than position for a move, given that a few people will probably want to protect their books at this stage of the year if they have performance to protect.”
Energy weighed, with Tullow Oil the biggest faller on the index. It shed 5.8 per cent after announcing it had not found any commercial hydrocarbons after completing drilling at an offshore well in French Guiana.
The FTSE 100 index closed down 6.48 points, or 0.1 per cent at 5,877.72, underperforming gains of 0.4 per cent on the French CAC 40 and one per cent for Italian blue-chips.