In the UK the FTSE 100 index of leading shares has started badly for a fifth day dropping 16.30 points, or 0.3%, to 5305.60 paced by Cable & Wireless Britain's and British Airways.
Ten stocks on the FTSE 100, including Anglo American and Barclays are trading today without the right to their latest dividend, helping to push down the benchmark.
Cable & Wireless has fallen 1.4% to 154p. The shares slipped 4.1% yesterday when it said it will pay at least £594m for Energis to gain business customers including Tesco and International Business Machines.
British Airways has slipped 1.5%, to 287.25p, while Aviva has also dropped 2.1% to 624p.
Meanwhile Balfour Beatty has gained 4.75p to 345p the firm saying this morning first-half net income advanced 39% to £57m after it won engineering contracts from utilities and stemmed losses at its US road-building business.
Cyprotex is up 0.5p to 12p, a three-month high. The company said its first-half net loss narrowed 45% £419,163 on US and Japanese expansion.
EasyJet rose is also up 6.25p to 301.5p after saying today it has hired SR Technics to provide maintenance for its fleet of Airbus A319 airplanes in a 10-year contract worth $1bn.
In Japan the Nikkei 225 Stock Average slipped back from four-year highs with some exporters such as Fuji Photo Film falling as US retailers such as Wal-Mart said record gasoline prices cut consumer spending.
At its close a short while ago the Nikkei had fallen 42.55 points to 12,273.12.
Fuji Photo dropped 50 yen to 3,630 and Hitachi, Japan's largest electronic goods manufacturer, slid 8 yen to 681. Meanwhile banks rose with Mizuho, Japan's largest lender, gaining 4,000 yen to 547,000. UFJ Holdings, Japan's fourth largest bank, also gained 7,000 yen to 653,000.
Economists from brokerages including Morgan Stanley, Societe General and BNP Paribas have said the Japanese economy will expand faster than earlier anticipated this business year because consumers and companies are spending more.
Japan's gross domestic product will probably expand 2% in the year ending March 2006, accelerating from 1.9% last fiscal year, according to the median forecast of 14 economists.
Mitsubishi Gas Chemical, the world's third-largest methanol manufacturer, jumped 52 yen to 700, it highest gain in almost 15 years.
Elsewhere, KDDI Corp, Japan's second-largest mobile-phone operator, fell 17,000 yen to 582,000. The stock was lowered to ``equal-weight'' from ``overweight'' by analysts.
And in the US stocks tumbled after Wal-Mart said higher petrol prices has limited customer spending the Dow Jones Industrial Average falling 120.93 points, or 1.14%, to 10,513.45.
The news sent many US retail stocks lower, while government data showing a larger-than-expected jump in inflation also dampened investor enthusiasm.
Wall Street is facing increasing evidence that high energy prices, spurred by record crude oil futures, are nipping consumer spending.
Wal-Mart stock drooped after the company blamed lower quarterly revenues on higher petrol prices. Shares of other retailers, including Target, Home Depot and Limited Brands dropped as well.
Investors also worried over the latest reading of the Labour Department’s Consumer Price Index, which rose 0.5% in July – the biggest increase in three months and larger than the 0.4% hike economists had expected. With food and energy prices removed, “core” CPI rose 0.1%.
Crude oil futures traded in a narrow range but remained in the mid-US$60 range – high enough to keep petrol and heating oil prices near record levels. A barrel of light crude was quoted at US$66.08 a barrel down $0.19 in the New York.
Investors focused on Wal-Mart and its warnings of future troubles Wal-Mart fell $1.53 to $47.57.
Home Depot fell $0.94 to $40.67 despite reporting a 14% jump in quarterly profits that beat Wall Street’s expectations by $0.03 per share on strong revenues.
The company, apparently avoiding the energy pinch felt by Wal-Mart and other retailers, also increased its profit forecasts for the rest of the year.
Teen retailer Abercrombie & Fitch closed regular trading down $2.32 to $61.23. Its earnings, released after the close of regular trading, missed analysts’ estimates and the stock dropped a further $4.48 to $56.75 in extnded trading.
Other retail and consumer stocks dropped, including Target, which fell $1.44 to $55.71, Limited, which fell $0.84 to $23.35 and Starbucks, which fell $1.15 to $51.09.
Computer maker Gateway, posted a quarterly profit for the first time in three years, but cut its profit and sales forecasts for the rest of the year. That led analysts to cut their rating on the company to ”underperform” from “peer perform”. Gateway tumbled $0.78, or 20%, to $3.11 as a result.
Delta Air Lines also rose $0.19 to $1.58 after it sold its Atlantic Southeast Airlines unit to SkyWest in an effort to stave off bankruptcy. SkyWest climbed $2.97 to $25.01..IFAonline
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