It was a fairly dismal end to a fairly dismal week.
index lost 5% in value in five trading days to close Friday at 6,346.3, a loss of just 2.4 points on the day, but a fall of 312 points on the week.
The Footsie traded Friday between a high of 6,374.7 and a low of 6,287.1 as interest-rate worries and four consecutive declines on the
Dow Jones Industrial Average
left investors with little appetite for opening fresh positions.
Indeed, profit-taking has been the name of the game, especially since the
Group of Seven
meeting this weekend has created an atmosphere of uncertainty, while U.S. stocks have the added burden of a
meeting at the start of February, which many expect to result in a rise in U.S. interest rates.
U.K. money-supply and bank-lending data released Friday merely underlined the perception that the
Bank of England
will move soon to raise interest rates. As well as a higher-than-expected increase in
money supply in December, credit-card loans rose by the largest monthly amount since records began in 1974.
Some concession has to be made for the accommodative stance adopted to ensure adequate levels of liquidity over the uncertainty of the millennium period, but the writing is on the wall.
Despite the gloom on the interest-rate front, some bright spots remained within the banking sector.
rose 66 pence, or 5.9%, to 11.80 pounds on news that should the takeover bid from
Bank of Scotland
succeed, the U.K. insurer
could gain exclusive rights to sell its branded life, pension and retail investment products through NatWest branches. Prudential investors reacted with less enthusiasm, and the insurer fell 4 pence, or 0.4%, to 11.02 pounds.
, a major High Street retailer, rose 9, or 1.7%, to 527 pence despite a denial from the German retailer
that it is about to launch a bid for the company. However, Metro said that it has been approached by unnamed parties with a view to establishing a working relationship, and its shares closed 2.3% higher at 45.50 euros. Earlier in the week, Metro's shares had received a boost from rumors the company was talking to its American nemesis
Among technology stocks,
advanced 305 pence, or 10%, to 33.60 pounds, as investors viewed its recent fall due to competition worries from the U.S.'
as being overdone.
Europe's continental bourses also posted broad losses Friday, led by the slumping tech and telecom sectors. Frankfurt's
ended nearly 2% lower at 6992.75, and the Paris
finished down 0.50% at 5681.32.
The Dax was hardest hit by the heavy weighting of
, which Thursday released preliminary earnings figures for 1999 that were almost half of the year before. Deutsche Telekom shares ended down almost 4% at 66.85 euros.
Despite the losses, some investors remain sanguine about the sector. "Sure, telecoms are getting hit right now, but that they'll bounce back is all but certain," said one Frankfurt-based fund manager, who is long the sector.
Tech shares also had a poor day with software maker
down almost 1% at 722 euros, and
ended 0.45% lower at 137 euros.