London close: Flat finish as Italian optimism fades

28th Dec 2011 17:41

London's blue chip index finished flat after initial optimism surrounding an Italian bond auction faded. After a foray into the blue by midday, most European stock markets finished the day firmly lower .Italy managed to borrow over €10bn on international debt markets today at interest rates sharply lower than recent times. The yield on €9bn worth of six-month bonds was 3.251%, down from 6.504% last month, while €1.7bn in two-year bills went at 4.853%, significantly lower than the crippling price of 7.814% paid for equivalent debt in November.Markets are now looking ahead to Italy's second sale of longer-dated securities with the nation aiming to sell of €8.5bn of bonds tomorrow. After an earlier fall today, Italian 10-year bond yields nudged 0.1 basis points higher to 7%, an 'unsustainable' level seen by many.Meanwhile, the European Central Bank's balance sheet increased to a record €2.73 trillion. In the week ended 23 December, lending to Eurozone banks rose €214bn to €879bn.The euro subsequently tumbled against the dollar, causing oil and metals prices to decline. The euro fell from $1.3074 to $1.2991.In domestic news, the Chartered Institute of Personnel and Development revealed that the number of employed people in Britain is likely to decrease by 120,000 next year, with the nation facing the weakest jobs market since the early 1990s.EVRAZ PROVIDES A DRAG, OIL STOCKS FALLSteel giant Evraz was the worst performer, after signing a $610m five-year revolving credit facility for its US and Canadian subsidiaries. The funds will be used to re-finance the existing $225m and C$300m facilities, as well as other capital requirements.Joining Evraz in the red were oil-related stocks Cairn Energy, BP, AMEC and Petrofac, tracking oil prices lower Other company news was thin on the ground, as per usual post-Christmas. bwin.party jumped over 20% on the FTSE 250 on reports that the US Department of Justice are thinking about legalising online poker. Sector peers Playtech and 888 Holdings were also in demand.Thomas Cook fell after agreeing to sell a surplus office property to FN2 BV, a company of the Fotex Group, for €18m. "This transaction is part of Thomas Cook's disposal programme announced earlier this year, which has targeted selling up to £200 million of non-core assets over a six to eighteen month period," the firm said. The proceeds of the sale will be put towards reducing the travel operator's borrowings and/or general corporate purposes.AIM-listed oil and gas firm Max Petroleum saw its shares fall after the SAGW-2 appraisal well (Blocks A&E Licence area, Kazakhstan) proved not to be commercial. Production testing has begun at SAGW-1 while NUR-1 is on track to reach total depth in April as expected.Consumer finance group MCB Finance jumped after revealing that second-half lending volumes have grown "substantially" in comparison to the first half and the second half the year before. Revenue and net income for the year ending 31 December is expected to be slightly above market expectations.FTSE 100 - RisersIntertek Group (ITRK) 1,997.00p +2.94%InterContinental Hotels Group (IHG) 1,148.00p +2.50%Tesco (TSCO) 399.80p +2.25%British American Tobacco (BATS) 3,057.50p +1.97%Compass Group (CPG) 602.50p +1.69%Capita Group (CPI) 637.50p +1.67%ITV (ITV) 65.50p +1.63%G4S (GFS) 268.30p +1.44%Diageo (DGE) 1,396.50p +1.34%Ashmore Group (ASHM) 329.10p +1.29%FTSE 100 - FallersEvraz (EVR) 373.30p -4.87%Barclays (BARC) 172.20p -3.80%Royal Bank of Scotland Group (RBS) 19.85p -3.36%Lloyds Banking Group (LLOY) 25.02p -2.63%GKN (GKN) 179.10p -2.61%ICAP (IAP) 336.40p -2.38%Petrofac Ltd. (PFC) 1,415.00p -2.35%BT Group (BT.A) 188.00p -2.34%International Consolidated Airlines Group SA (IAG) 147.70p -2.31%Antofagasta (ANTO) 1,200.00p -2.28%FTSE 250 - RisersBwin.party Digital Entertainment (BPTY) 160.00p +22.79%Phoenix Group Holdings (DI) (PHNX) 547.00p +5.80%Cape (CIU) 334.70p +5.48%Ophir Energy (OPHR) 273.40p +4.83%Home Retail Group (HOME) 86.75p +4.77%Logica (LOG) 62.50p +4.17%FTSE 250 - FallersSupergroup (SGP) 486.70p -8.34%Centamin Egypt Ltd. (CEY) 80.75p -5.22%Talvivaara Mining Company (TALV) 201.80p -4.81%Afren (AFR) 83.80p -4.50%Hochschild Mining (HOC) 373.50p -4.06%BC