Footsie slides with equities exposed to emerging markets main losers

FTSE: 5,128.48 (–68.36) Mid-250: 9,819.39 (–166.06) Small Cap: 2,805.30 (–13.59)LONDON EQUITIES continued to fall yesterday, keeping the FTSE 100 on course for its worst quarterly loss since the height of the financial crisis.

Worries about the potential impact of any unruly Greek default on the outlook for global growth were characteristic of the selling, undermining hopes that companies active in faster-growing markets could provide a haven from the turbulence in the euro zone.

As third quarter trading closed, Burberry, a high fashion retailer associated with exposure to emerging markets, was one of the weakest stocks on the FTSE 100, down 2.3 per cent at £11.74. Standard Chartered, a UK bank focused on Asian emerging markets, fell 5.2 per cent to £12.87. HSBC was 3.1 per cent weaker at 496.9p.

Hedge fund manager Man continued its descent after it warned this week of fresh capital outflows prompted by the market turbulence. The stock fell a further 4.3 per cent to 168½p.

Overall, London’s benchmark index fell 68 points to 5,128.48, a loss of 1.3 per cent. Over the third quarter it was down 13.8 per cent – it has not fallen further over a quarter since the collapse of Lehman Brothers in 2008.

September has been a volatile month spent in thrall to the continual twists and turns of the uncertain political response to the euro zone debt crisis.

“Traders seem uncertain about the market’s direction over the near term,” said James A Hyerczyk, analyst at Autochartist.

“The first sign of strength to the upside will be a penetration of a top at 5,250.18. Traders must be willing to buy strength or the rally will fail. This has been the key element absent from the market. If traders are unwilling to buy strength at some point, the rallies will continue to become set-ups for the short sellers,” he said.

Heavily-weighted banking and mining stocks were under pressure as traders across global markets remained reluctant to take on risk.

Chilean copper miner Antofagasta was 3.3 per cent softer at 926½p. Commodities trader Glencore fell 1.6 per cent to 402p.

The biggest faller was testing systems engineer Intertek after a broker downgrade, which dropped 9.5 per cent to £18.55. UBS cut its stance on the stock from “neutral” to “sell”. – (Copyright The Financial Times Limited 2011)