FTSE down as US figures disappoint

The FTSE 100 Index closed nearly 62 points lower at 5733

Published: 9:07am, 27th January 2012
Updated: 6:19pm, 28th January 2012

London's leading shares index has pulled back from its six-month high after disappointing economic growth figures in the US and a lack of movement in the eurozone weighed on investor confidence.

The FTSE 100 Index closed 61.8 lower at 5733.45 after the US Commerce Department said the world's largest economy grew at an annualised 2.8% in the final three months of last year. Economists had expected 3% growth.

Meanwhile, European Union commissioner Olli Rehn said Greece and its private creditors were "very close" to reaching a deal over its debts, which is crucial if the debt-laden nation is to received another slice of its bailout and avoid bankruptcy.

However, with no formal announcements made before trading closed, this was not enough to tempt traders in London back to the markets.

Chris Beauchamp, market analyst at IG Index, said: "Yet again we end the week without any sign of a deal between Greece and its creditors, and negotiations are scheduled to drag on over the weekend, leaving markets once again at the mercy of a breakdown in talks."

The pound was up against the weakened euro at 1.19, but was down against the US dollar at 1.56.

The dampened sentiment hit the heavily-weighted mining sector, with copper giant Antofagasta topping the fallers' board with a fall of 42p at 1348p. Kazakhmys was not far behind, dropping 34p at 1160p, while gold and silver producer Polymetal International slipped 27p to 1125p.

BP shares were under pressure after a Louisiana court ruled contractors Transocean and Halliburton do not have to pay compensation, although they could still be liable for damages and civil penalties relating to the Gulf of Mexico spill.

Analysts at Nomura said it made it less likely that BP will settle with its former contractors on the Deepwater Horizon rig before the matter goes to full trial next month. BP's shares were 3% or 12.2p lower at 464.6p.

The biggest Footsie risers were Next up 45p at 2639p, Imperial Tobacco ahead 36p at 2289p, Icap up 5p at 345.6p and Randgold Resources ahead 90p at 7260p. The biggest Footsie fallers were Antofagasta down 42p at 1348p, Kazakhmys off 34p at 1160p, BG Group down 39.5p at 1430.5p and Intercontinental Hotels off 36p at 1321p.