London shares close flat as easyJet tumbles

London shares closed flat on Wednesday as markets looked ahead to the latest economic update from the US Federal Reserve.

The benchmark FTSE 100 index ended the day 6.33 points or 0.10 percent higher at 6,474.74.

The Fed was due late Wednesday to release its "Beige Book", which gives a read of US regional economic conditions and could provide clues on whether the central bank is likely to taper its aggressive bond-buying stimulus program.

Markets are also eyeing the political debate surrounding a possible US military strike on Syria.

President Obama said in Sweden Wednesday that "in the face of such barbarism," the global community needed to act against Syria.

"European stocks continued to drag into the afternoon ahead of the Federal Reserve economic outlook survey later this evening," said Lee Mumford, a financial sales trader at Spreadex.

Data from the UK showed a jump in the services Purchasing Managers Index to more than a six-year high, challenging the Bank of England’s cautious outlook for the economy a day before the monetary policy meeting tomorrow, Mumford noted.

"Crude traded lower today as the US debated a military strike on Syria whilst interventions from Russia clouded the prospects for an attack," the trader said..

Vodafone recovered 2.22 percent to 207 pence in the wake of Tuesday's losses amid investor disappointment about the terms of the mobile phone giant's $130 bn disposal of its stake in Verizon Wireless in the US.

Barclays rose 1.56 percent to 289.55 pence as the bank said it will launch a long-planned £5.8 billion rights issue next week to help meet a regulatory demand to plug a hole in its balance sheet.

Ian Gordon, an analyst at Investec financial group, told AFP that Barclays will probably eventually return the new capital from the rights issue to shareholders, arguing that it should have not been required to increase its buffer.

"I do not recognise the existence of a £12.8-billion hole" he said. "The rights issue is entirely the consequence of the implementation of the arbitrary and bank-specific June 2014 deadline for meeting a new and contrived measure of leverage."

Easyjet plunged 5.08 percent to 1,215 pence as shareholders in the budget airline were spooked by a profit warning from rival Ryanair.

The Irish airline said the group's annual net profits could miss forecasts, pushing the value of its stock market value down by almost 15 percent at one point.

Ryanair said in a statement that it "now expects the full-year outturn will be at the lower end of its full-year net profit range of 570-600 million euros" ($750-790 million).

"However if fares and yields continue to weaken over the coming winter there can be no guarantee that the full-year outturn may not finish at or slightly below the lower end of this range," it added.

Tourism company Tui Travel was also hit by the Ryanair revelation, dropping 3.21 percent to 334.60 pence.

On the currency markets, sterling strengthened to $1.5638 at 5:28 pm from $1.5547 on Tuesday evening and improved to 1.1836 euros from 1.1814 euros a day earlier.

Source: http://news.yahoo.com/london-shares-close-flat-easyjet-tumbles-163309322.html

Sandy Hook conspiracy Stuart Scott Holly Rowe Chief Keef FRANK ZAMBONI Tiffany Six jodie foster