It was a big day for retailers, with Christmas retail trading updates from the likes of Marks & Spencer (MKS) and Tesco (TSCO).
Tesco revealed like-for-like sales in the UK and Ireland over the 19 weeks to 6 January grew 2.3%, but this was 0.5% lower than anticipated. The sales miss was affected by a decline in tobacco sales and general merchandise. Shares in Tesco were marked 4.6% lower at 202.2p.
Marks & Spencer (MKS) was also in the firing line following its third consecutive period of falling sales in clothing and homeware. Investors were concerned about a 0.4% decrease in food sales over the third quarter as the retailer usually performs well in this division. The stock declined 5.7% to 305.4p.
These results weighed on the whole retail sector, while the housebuilding sector suffered weakness following a mixed update update from Barratt Developments (BDEV).
Barratt Developments (BDEV) added to concerns over the housebuilding sector's outlook, flagging flat revenue in the second half of last year. The stock shed 2.7% to 617p.
The FTSE 100 advanced 5 points to 7,753 around midday.
Brent crude oil rose 0.4% $69.46 per barrel.
US markets lost their stellar run in January as the Dow Jones closed 0.1% lower at 25,369 overnight.
MID AND LARGE CAP RISERS AND FALLERS
Wholesaler Booker (BOK), which is expected to be taken over by Tesco, declined 3.6% to 224.4p. Total sales were up 3.4% in the 16 weeks to 29 December, but tobacco sales were down 2.6%.
There was further bad news in the retail sector from greetings card firm Card Factory (CARD). The company reduced its earnings expectations from between £93m and £95m, down from £97.8m. Card Factory also warned of an extra £7m to £8m in costs, causing the shares to plummet 18.5% to 230p.
Defence contractor Ultra Electronics (ULE) benefitted from an 18.5% relief rally to £14.76 as investors had feared another profit warning since the last one in November. The company reported expected revenues of 62% in 2017, up from 56%, and a strong order book.
Weir (WEIR) retreated 3.3% to £21.82 as the market was expecting more benefits from US tax reform. The engineer said it expected a one-off non cash tax credit from the changes.
Midcap recruiter Hays (HAS) gained 3.4% to 194.7p thanks to higher quarterly net fees and an encouraging performance internationally.
Gambling business GVC (GVC) revealed 2017 core earnings are anticipated to hit the high end of its expectations as strong trading in the fourth quarter provided a boost. The shares nudged 1% higher to 968p.
SMALL CAP RISERS AND FALLERS
Online fashion retailer Boohoo.com (BOO) hiked its full year sales forecast after doubling revenue in the four months to 31 December. Despite the upbeat outlook, shares in the company were down 2.6% at 201.6p.
Premier Oil (PMO) said it expects output to rise by over 10% in 2018 to up to 85,000 barrels of oil equivalent per day, prompting the shares to rise 3.5% to 101.9p.
Lombard Risk Management (LRM) recommended a takeover from Dutch firm Vermeg at 13p per share, which valued the business at approximately £52m. The news excited investors as the shares soared 93.7% to 12.6p.