FTSE CLOSE: Markets dragged lower by BP share slump and nerves ahead of ECB action
17.30 (close): A slump for oil giant BP amid fears it will be unable to secure an out-of-court settlement with the US government over the Gulf of Mexico disaster dragged the London market lower today.
BP slumped 3 per cent after the US Department of Justice accused it of 'gross negligence and wilful misconduct' in the Deepwater Horizon explosion that claimed 11 lives.
BP denies the allegations of gross negligence and with the company being a major constituent of the FTSE 100 Index, the top flight closed down 14.2 points at 5657.9.
Market watch: Traders are fretting over whether the ECB will unveil a robust enough plan to help stricken eurozone members
Meanwhile, nerves that the European Central Bank will fail to prescribe the medicine needed for the ailing eurozone on Thursday also rattled traders.
But optimism was building amid reports the ECB may pledge to buy an unlimited amount of up to three-year bonds.
The pound was consequently down against a more buoyant euro at 1.26, while sterling was up against the US dollar at 1.59.
However, Kathleen Brooks, research director at Forex, said she did not see the September meeting as a 'game changer'.
She said: 'We think the most important meeting will be the October meeting, when the ECB will announce in detail its plan to purchase bonds and also, crucially, a start date for the purchases.'
Sports Direct International has shown no signs of suffering in the economic slowdown as Team GB's success during an 'unprecedented sporting summer' helped profits rise 20.4 per cent to £211.1 million in the 13 weeks to July 29.
The chain, which has nearly 400 stores and has sold an array of sportswear geared towards the Games including the TeamGB kit designed by Stella McCartney, said store sales rose 19.9 per cent. Shares were 3 per cent higher, up 10p to 324p.
Hargreaves Lansdown shares were 4.5p lower at 626p despite the investment funds broker reporting a 21 per cent hike in pre-tax profits to a record £152.8 million in the year to June 30.
The bumper results triggered a bigger than expected dividend pay-out, ensuring founders Peter Hargreaves and Stephen Lansdown, who are still major shareholders, will receive £26.7 million and £16.7 million respectively.
Investors were also toasting the prospect of a surprise merger deal involving Irn-Bru maker AG Barr and Robinsons owner Britvic.
Barr said the discussions were at an early stage after it approached its Essex-based rival Britvic about a potential all shares tie-up.
It has already been agreed that Britvic shareholders will own 63 per cent of any new company. Shares in both companies fizzed today, with Britvic valued at £889 million after a rise of 13 per cent or 41.3p to 369.9p while AG Barr lifted 8 per cent, up 34.6p to 450.2p and valuing it at £525.7 million.
The biggest Footsie risers were Wolseley up 58p at 2620p, Lloyds Banking Group ahead 1p at 33.9p, Xstrata up 17.6p at 935.1p and Croda International ahead 66p at 2429p.
BP slumped 3 per cent after the US Department of Justice accused it of 'gross negligence and wilful misconduct' in the Deepwater Horizon explosion that claimed 11 lives.
BP denies the allegations of gross negligence and with the company being a major constituent of the FTSE 100 Index, the top flight closed down 14.2 points at 5657.9.
Market watch: Traders are fretting over whether the ECB will unveil a robust enough plan to help stricken eurozone members
Meanwhile, nerves that the European Central Bank will fail to prescribe the medicine needed for the ailing eurozone on Thursday also rattled traders.
But optimism was building amid reports the ECB may pledge to buy an unlimited amount of up to three-year bonds.
The pound was consequently down against a more buoyant euro at 1.26, while sterling was up against the US dollar at 1.59.
However, Kathleen Brooks, research director at Forex, said she did not see the September meeting as a 'game changer'.
She said: 'We think the most important meeting will be the October meeting, when the ECB will announce in detail its plan to purchase bonds and also, crucially, a start date for the purchases.'
Sports Direct International has shown no signs of suffering in the economic slowdown as Team GB's success during an 'unprecedented sporting summer' helped profits rise 20.4 per cent to £211.1 million in the 13 weeks to July 29.
The chain, which has nearly 400 stores and has sold an array of sportswear geared towards the Games including the TeamGB kit designed by Stella McCartney, said store sales rose 19.9 per cent. Shares were 3 per cent higher, up 10p to 324p.
Hargreaves Lansdown shares were 4.5p lower at 626p despite the investment funds broker reporting a 21 per cent hike in pre-tax profits to a record £152.8 million in the year to June 30.
The bumper results triggered a bigger than expected dividend pay-out, ensuring founders Peter Hargreaves and Stephen Lansdown, who are still major shareholders, will receive £26.7 million and £16.7 million respectively.
Investors were also toasting the prospect of a surprise merger deal involving Irn-Bru maker AG Barr and Robinsons owner Britvic.
Barr said the discussions were at an early stage after it approached its Essex-based rival Britvic about a potential all shares tie-up.
It has already been agreed that Britvic shareholders will own 63 per cent of any new company. Shares in both companies fizzed today, with Britvic valued at £889 million after a rise of 13 per cent or 41.3p to 369.9p while AG Barr lifted 8 per cent, up 34.6p to 450.2p and valuing it at £525.7 million.
The biggest Footsie risers were Wolseley up 58p at 2620p, Lloyds Banking Group ahead 1p at 33.9p, Xstrata up 17.6p at 935.1p and Croda International ahead 66p at 2429p.
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