Barclays down as trading tax talk spurs financials sell-off

Barclays was a sharp faller on Wednesday as financial stocks broke the FTSE 100's four-day winning streak. Barclays slipped 4.2 per cent to 174p as deadlock in the eurozone crisis combined with new threats of a trading tax to send the UK banks lower. Analysts also highlighted the departure of Barclays' commodities team, poached two years ago at a reported cost of 50m, and the elevated cost of insuring Barclays' debt against default. Credit default swaps for the group were near their highest since March 2009, having spiked by more than 50 per cent this month. "If Barclays or any other bank does need another round of equity fundraising, we believe that equity investors have very little appetite to swallow this," said Seymour Pierce analyst Bruce Packard. "The current share prices of banks [not just Barclays] suggest investors are right to be sceptical, given that previously rights issues have been followed by the recognition of huge <a href="http://guccibagsshopus.com/"><strong>gucci handbags cheap </strong></a> bad debts, indiscriminate hiring sprees and basic salary pay rises in investment banking." The rest of the financial sector slipped as German Chancellor Angela Merkel and French President Nicolas Sarkozy resurrected proposals for a "financial transactions tax" resurrected proposals for a "financial transactions tax" to reduce trading flows. Icap lost 3.7 per cent to 428p and Tullett Prebon fell 4.2 per cent to 354¼p, with the inter-dealer brokers vulnerable to profit taking having benefited from the heightened market volatility in recent weeks. London Stock Exchange was down 2.8 per cent to 846p and IG Group declined 3.7 per cent to 411p. The FTSE 100 ended 0.5 per cent, or 26.03 points, lower at 5,331.6 on volumes down about a fifth on the daily average. Precious metals miners gained. Fresnillo led the FTSE 100 risers in spite of trading ex-dividend, up 5.6 per cent to £19.66. Aquarius Platinum rallied 6.6 per cent to 259¾p, Broker Seymour Pierce noted that the stock was down 15 per cent <a href="http://guccibagsshopus.com/"><strong>gucci bags</strong></a> since early August even though platinum had held steady. "We believe the sharp move down in the share price presents a fresh opportunity to gain exposure to one of the market's better platinum plays," it said. ENRC was up 3.7 per cent to 655p as investors shrugged off half-year earnings that were slightly weaker than consensus forecasts. Merrill Lynch said ENRC was "deeply undervalued" versus peers but expected investors to remain cautious ahead of a corporate governance review due next month. But Talvivaara Mining lost 7.4 per cent to 333½p after maintenance stoppages meant its quarterly results were much weaker than consensus forecasts. The Finnish nickel miner also warned that 2011 volumes would be at the lower end of previous guidance. Unilever took on 1.8 per cent to £20.72 amid hopes it would win promotion to the Stoxx 50 index as part of an annual review due on August 31. Imperial Tobacco , up 0.2 per cent to £20.57, was also in line to join the benchmark. Standard Life , which was trading without rights to a 4.6p dividend, was marked down 5.1 per cent to 201½p. Morgan Stanley repeated "underweight" advice, arguing that recent results from the insurer had been boosted by "low-quality items" such as taking more asset risk in Canada. Arm Holdings faded 2.1 per cent to 514½p after an overnight profit warning from Dell weighed on technology stocks. Traders also noted cautious guidance from Analog Devices, with the US chip maker blaming a supply chain inventory correction following Japan's earthquake. Capital Shopping Centres edged up 0.5 per cent to 335¼p. Deputy chairman John Whittaker spent nearly £1m to raise his stake in the property developer above 20 per cent. Berendsen , the laundry group formerly known as Davis Service, gained 7 per cent to 495p ahead of its results <a href="http://guccibagsshopus.com/"><strong>gucci bags cheap </strong></a> on Friday. Interim results from Balfour Beatty sent its shares lower by 5.3 per cent to 249p, with the engineering consultant flagging up that the outlook for UK and US construction spending was getting tougher.