Bank shares falter after positive week

THE FTSE 100 was on course for a positive end to the first quarter of the year today, but momentum was fading from this week’s relief rally.

Much of the advance came from financial stocks as confidence flowed back into the sector and the wider market. Wider fears over the potential knock-on effects of problems at European and US banks eased consistently. But the recovery, which ran since Monday, left bank shares looking tired into the weekend and they gave back some of the rebound.

HSBC fell 6p on the session to 550p. Standard Chartered, the UK bank focused on emerging Asian markets, fell by 3p to 612p. NatWest was 2p lower at 263p.

London’s insurance stocks slipped as wider attention stayed on the global financial sector while the shockwaves of Credit Suisse’s rescue deal last week with UBS faded. Prudential fell 14p to 1101p, with Aviva 5p weaker at 401p

Overall, the FTSE 100 was up just 16.39 points at 7,636.82, leaving it up by just over 1% for the year to date.

James Hughes at Scope Markets said: “London’s blue chip index has made no meaningful progress over the quarter but once you put this against a backdrop of ongoing rate hikes and a threatened full-blown banking crisis, the fact we’re still around these levels is commendable.” Travel and tourism stocks headed north after upbeat broker comment on the sector. Barclays lifted its price target on easyJet’s stock to 570p from 510p, helping it rise by 17p to 518p. British Airways’ owner, IAG, added 3p to 151.4p after Deutsche Bank, upped its price target on the stock to 200p from 180p.

News of the ninth consecutive monthly fall in house prices hit residential developers. Persimmon fell 11p to 1257p. Barratt Developments fell 2.3p to 470p.

Computacentre reported its 18th consecutive year of higher earnings per share and profit before tax of £264 million, up 3.2%. Stock in the Hatfield-based IT services firm held steady at 2088p.