FTSE 100 falls on financial stocks
Monday 16th February 2009, 5:25PM GMT.
The FTSE 100 has started the week by falling 1.31 per cent to 4,134.75 as financial stocks continue to weigh on the index.
With US markets closed for Presidents’ Day, activity was slower, while gloomy financial news continued to drag the sector down.
A report in the Financial Times that Legal & General were in talks with the FSA sparked fears in investors the firm may seek extra capital from shareholders, despite the insurer’s insistence the discussions were routine.
Legal & General shares fell 10.10 per cent over the day, closely followed by Lloyds Banking Group, down by 8.14 per cent, and rival Prudential, which saw its shares fall by 8.03 per cent.
Shares in Lloyds Banking Group are still declining after the lender reported huge expected losses at HBOS, the bank taken over by Lloyds TSB.
Few stocks avoided falling into the red on Monday, although defensive pharmaceutical stocks received a lift.
Shire led the risers, and was up 1.59 per cent by the end of the day.
Ryan Kneale, market analyst at BetsForTraders.com, said: “With the US markets closed today, trade is, as expected, a little quiet.
“Uncertainty and banking write downs are therefore top of everyone’s agenda following the profit warning from the Lloyds group on Friday. With the threat of nationalisation looming larger than ever for the banking giant, we are seeing stocks being dumped by traders once again.”
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