Old Mutual, the fund management group, pulled the FTSE 100 down by the end of the day after it agree...
Old Mutual, the fund management group, pulled the FTSE 100 down by the end of the day after it agreed to let St. Paul Cos., the fourth- biggest U.S. business insurer, sell 190m of its shares.
Declines by GlaxoSmithKline and AstraZeneca worsened the situation and dragged the FT-SE 100 Index down 42.2 points, or 0.8%, to 5040.8.
Old Mutual fell 5.5p or 4.8%, to 108.5p because it had made acquisitions to reduce its dependence on the South African market last April. OM promised to pay St. Paul about $300 million in stock and $335 million in cash to buy Baltimore-based Fidelity & Guaranty Life Insurance Co, so the impact was huge when St Paul sold the bulk of that stock.
GlaxoSmithKline shed 3.6% to £14.37, its lowest since January 1997, as the world's second-largest drugmaker was downgraded to ``market perform'' from ``market outperform'' by analysts at Goldman Sachs, then knocking AstraZeneca.
Big Food Group is still rallying and gained another 9.4% to 105p after the U.K. wholesale and supermarket company posted a full-year profit of £9.3m from a loss of 118.3 million pounds a year earlier. The stock has rebounded 35% from a 6-year low on May 16.
But Evolution Group, who owns a sizeable chunk of Inter-Alliance, slumped 9.3% to 63.5p. because it has agreed to buy rival Beeson Gregory Plc for £92.1m, to expand into investment banking for small and medium- sized companies.
Activity is not much better in the US right now as government figures show the number of people receiving unemployment benefits are now at their highest level for more than 19 years.
The Dow Jones has dropped 19.44 points or 0.2% to 9903.60 while the Standard & Poor's 500 Index fell 2.90 points or 0.3% to 1064.76, held up by gains in Microsoft and Tyco International. The Nasdaq Composite Index is relatively flat at 1622.83.
Microsoft gained 60 cents to $52.63 because reports that it is in talks with the SEC to settle misrepresentation claims are seen as positive. The world's largest software maker is in talks with the Securities and Exchange Commission to settle claims that it misrepresented its financial statements, the Wall Street Journal reported, citing people familiar with the situation.
Philip Morris also gained 39 cents to $56.40 after agreeing to sell it Miller Brewing Co. Unit to South African Breweries Plc for $5.6bn in stock and assumed debt.
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