Reuters: Hot Stocks: Domestic growth caps UK shares ahead of budget statement

Reuters: Hot Stocks Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

Domestic growth caps UK shares ahead of budget statement Dec 4th 2012, 17:04 Tue Dec 4, 2012 12:04pm EST * FTSE 100 closes flat * Growth outlook and construction activity weak * Cautious trade sees defensives gain * Financials gain in line with European optimism By Alistair Smout LONDON, Dec 4 (Reuters) - Britain's top share index closed flat on Tuesday, underperforming most European bourses as a swathe of downbeat domestic data outweighed optimism about crisis-hit Spain and Greece. British construction activity shrank last month, and confidence about the next year fell to its lowest in almost four years, as the British Chamber of Commerce said that growth in the next two years will be weaker than previously thought. The downbeat news provided a blow to finance minister George Osborne ahead of a half-yearly budget statement on Wednesday in which he is expected to defend an austerity plan that has failed to deliver a strong recovery. "I think people are generally very cautious on the UK ahead of tomorrow's autumn statement. People are just adjusting portfolios today, I wouldn't think people are taking a view on direction going into that statement," Ioan Smith, strategist at Knight Capital, said. "People will tend to trade moves, rather than position for a move, given that a few people will probably want to protect their books at this stage of the year if they have performance to protect." Reflecting this caution, volumes were thin, at just 70 percent of an already-thin average 90-day volume, and stocks seen as resilient to economic uncertainty prospered, with consumer staples alone adding 4.4 points. Conversely, energy, which is "cyclical," or sensitive to economic growth trends, weighed, with Tullow Oil the biggest faller on the index. It shed 5.8 percent after announcing it had not found any commercial hydrocarbons after completing drilling at an offshore well in French Guiana. Among cyclicals, financials proved resilient, adding 2.5 points to the index, with sentiment lifted by Spain's formal request for a bank bailout and optimism over Greece's debt deal. Spanish stocks gained 0.2 percent on the day, with European financials up 0.6 percent. The FTSE 100 index closed down 6.48 points, or 0.1 percent at 5,877.72, underperforming gains of 0.4 percent on the French CAC 40 and 1 percent for Italian blue-chips . Trading was tightly rangebound, as the index closed between 5,866 and 5,872 for the fourth day in a row. "With non-farm payrolls on Friday, I can see this week being fairly quiet, further exacerbated by seasonal trends in the lead up to Christmas," Jack Pollard, analyst at Sucden Finance, said. "On a technical basis ... if we look back to August, it all still looks so rangebound." (Editing by Catherine Evans) Link this Share this Digg this Email Reprints

You are receiving this email because you subscribed to this feed at blogtrottr.com. If you no longer wish to receive these emails, you can unsubscribe from this feed, or manage all your subscriptions