UK stocks ended Tuesday's session with small losses, influenced in part by some weaker-than-expected economic indicators from the Eurozone, marking the second day of losses this year.
Eurozone unemployment hit a new record high of 11.8% in November, according to official figures. This was a slight rise on the 11.7% rate the 17-nation bloc registered in October. More than 26m people are now unemployed across the EU, with that number totalling 18.8m in the Eurozone.
Also of concern was the British Retail Consortium's (BRC) prediction for this 2013. How will 2013 go you say? "Underwhelming" is the BRC's answer.
After reviewing the data economists at Barclays Research are of a similar mind, saying that: "With consumer confidence remaining depressed and spending power growth likely to be measured, we do not expect the retail environment to improve significantly this year."
Sales at stores open at least a year gained 0.3% in December versus a year ago, the worst performance since 2010, when adverse weather conditions deterred shoppers.
Meanwhile, research by a leading business group shows the UK economy grew in the fourth quarter of 2012, despite widespread fears of a triple dip recession.
The British Chamber of Commerce (BCC) Quarterly Economic Survey showed a pick up in both the manufacturing and service sectors in the last three months of the year. The survey of 7,662 businesses also found that levels of confidence and investment had increased over the period, despite remaining weak by historical standards.
In other news, the session saw Deutsche Bank upwardly revise its price targets for the majority of the construction & materials shares
under its coverage, with its favourite picks being Bovis Homes, Barratt Developments and Berkeley Group.
The broker raised its price target on Barratt Developments to 278p (from 224p), Bovis Homes to 667p (from 599p) and on Berkeley Group to 1,941 (from 1,925). They explain that, "through 2012 the UK house builder sector re-rated, moving from 0.69 times 2012 Net Tangible Asset Value (NTAV) to 1.0 times 2013 NTAV. However, as the sector reaches returns that cover its cost of capital in 2013, moving to mid teen levels by 2014/2015, we believe a further rerating is available. A sector creating mid teen return on capital employed (ROCE) on a sustainable basis (the upside being based on self-help measures rather than any housing market pick-up) we believe deserves to trade at a 20% premium to its NTAV (mid-range of its 2000-2005 valuation range)."
Of possible import, an adviser to China's central bank was cited as saying that it will be more cautious in the second half of the year regarding its monetary policy.
Vodafone gains; Insurers take a tumble
Telecoms titan Vodafone was a high riser after Verizon Communication's CEO said that a purchase of Vodafone's stake in their joint venture Verizon Wireless is feasible, according to The Wall Street Journal.
Insurance peers Standard Life, Legal & General and RSA Insurance were seen falling throughout the day after Bank of America Merrill Lynch downgraded its ratings for all three groups.
Investors welcomed Anglo American's appointment of Australian Mark Cutifani as its new Chief Executive. The mining giant pinched Cutifani from AngloGold Ashanti to replace Cynthia Carroll. Cutifani will take the reins in April with a pay packet worth around £2.38m, including salary and bonuses.
ARM Holdings was also up in the top 10 after Swiss broker Credit Suisse updated its forecasts for the chip maker so as to reflect the changes made to its forecasts for the handset industry in 2013. More specifically, analyst Kulbinder Garcha has raised his smartphone market volume estimates by 6%/15% and tablet estimates by 5%/13% for 2012/13.
Sainsbury was seen heading higher as confidence grew ahead of tomorrow's trading announcement, and after data from Kantar Worldpanel showed that it was the only grocer to gain market share these past holidays.
Meanwhile, Tullow Oil shares fell after Societe Generale cut its target price on the stock from 1,450p to 1,390p, while the hold rating remained unchanged. Investec also reduced its target price from 1,399p to 1,000p and downgraded the stock from hold to sell.
TUI Travel fell after Morgan Stanley downgraded the group from equal weight to underweight.
Croda International was also a big faller after Canaccord Genuity reiterated its 'sell' rating on the stock.
Debenham's was lower after saying that it now expects gross margin for the year to be 10 basis points higher than last year rather than 20 basis points as previously guided.
Nautilus Minerals rocketed higher following a hostile bid from Michael Bailey, an individual, and an entity controlled by him, to purchase all of the outstanding shares of the company.
Roxi Petroleum saw its shares almost double in value after a Kazakh businessman, Alpamysovich Satylganov, said he would invest $40m in the firm at a huge premium to the current price.
FTSE 100 - Risers
Shire Plc (SHP) 1,963.00p +2.56%
Sainsbury (J) (SBRY) 339.00p +2.20%
Vodafone Group (VOD) 162.40p +1.72%
Resolution Ltd. (RSL) 254.90p +1.59%
Carnival (CCL) 2,435.00p +1.46%
Anglo American (AAL) 2,028.00p +1.37%
Wood Group (John) (WG.) 749.50p +1.35%
Capital Shopping Centres Group (CSCG) 365.10p +1.25%
Aggreko (AGK) 1,769.00p +1.14%
ARM Holdings (ARM) 808.50p +1.13%
FTSE 100 - Fallers
Tullow Oil (TLW) 1,225.00p -3.62%
TUI Travel (TT.) 276.80p -3.42%
Antofagasta (ANTO) 1,288.00p -2.57%
CRH (CRH) 1,221.00p -2.55%
Whitbread (WTB) 2,462.00p -2.03%
Fresnillo (FRES) 1,742.00p -1.86%
Aviva (AV.) 381.90p -1.67%
Randgold Resources Ltd. (RRS) 5,780.00p -1.62%
Kazakhmys (KAZ) 806.50p -1.59%
GKN (GKN) 231.30p -1.45%
FTSE 250 - Risers
Centamin (DI) (CEY) 44.18p +8.95%
Bumi (BUMI) 303.70p +5.27%
Interserve (IRV) 415.80p +4.34%
Man Group (EMG) 89.55p +2.23%
Barratt Developments (BDEV) 215.90p +1.79%
SIG (SHI) 126.00p +1.61%
St. Modwen Properties (SMP) 241.10p +1.60%
Ferrexpo (FXPO) 273.00p +1.56%
Kentz Corporation Ltd. (KENZ) 394.00p +1.55%
Bovis Homes Group (BVS) 600.00p +1.52%
FTSE 250 - Fallers
African Barrick Gold (ABG) 352.10p -20.70%
Debenhams (DEB) 108.10p -7.69%
Michael Page International (MPI) 398.80p -3.83%
Dechra Pharmaceuticals (DPH) 619.50p -3.65%
Fenner (FENR) 411.00p -3.48%
Betfair Group (BET) 655.50p -3.39%
Renishaw (RSW) 1,885.00p -3.33%
Regus (RGU) 105.10p -3.31%
Unite Group (UTG) 275.60p -3.09%
Brewin Dolphin Holdings (BRW) 204.00p -3.09%