Further gloomy news from the Far East helped depress the FTSE index earlier this week, with heavy market falls in the region dragging down leading shares in London.
The 100 index remained below the 6000 mark this week, closing at 5809.7 on Monday, having edged up from the day’s low of 5752.
Ahead of the monthly meeting of the Bank of England’s Monetary Policy Committee, dealers said the market was set for more uncertainty.
The pound, meanwhile, continued to fall against the deutschmark, dropping below the psychologically important DM2.90 level for the first time in months. Sterling has now fallensix pfennigs against the mark and three and a half cents against the dollar over the past week.
Engineering shares were the main beneficiaries of these falls, with shares of several major exporters, including GKN, climbing on Monday.
On Tuesday, GKN was up 18p to 753p with analysts looking for better-than-forecast interim results later this week. Smiths Industries rose 59p at 770p, making it the 100 index’s best performer. The improvement makes up for some of last week’s 9.4% fall.
Not all engineers benefited. TI Group was down 17p to 427p, LucasVarity fell 9p to 204p and Siebe edged 11p lower to 1093p, despite a positive trading statement that buoyed the sector a week ago.