US unemployment figures slow FTSE

London Stock ExchangeA rise in US jobless claims has put the brakes on the FTSE 100 Index after Wall Street opened deep in the red.

Figures showing a slight rise in those seeking unemployment benefits sent the Dow Jones Industrial Average around 80 points lower, reversing earlier optimism about hopes of stimulus measures to help the world's two largest economies.
%VIRTUAL-SkimlinksPromo%The FTSE 100 lost earlier gains and was later down 5.6 points to 5768.6.

It had been on the front foot after minutes from the US Federal Reserve revealed a strong consensus for additional action to aid the still-weak economy while poor manufacturing data in China added to speculation that Beijing will consider some kind of stimulus move.
Investors were also watching the situation in the eurozone closely as Greek prime minister Antonis Samaras continued his campaign to get European leaders to give him more time for austerity measures to turn around his country's beleaguered economy.

Among stocks, gold miner Randgold Resources topped the FTSE 100 risers board with a gain of 4% or 242.5p to 6387.5p and silver miner Fresnillo cheered 44p to 1570p.

In a busy session for corporate results, Guinness and Smirnoff firm Diageo was 1% higher after reporting an 11% rise in operating profits to £3.2 billion for the year to June 30.

Sales of spirits rose 12% and accounted for 80% of its growth as demand for whiskey, gin and vodka in emerging markets offset the impact of Europe's debt hangover on some of its key markets. With chief executive Paul Walsh describing Diageo "as a strong business that is getting stronger", shares were 11p higher at 1691.5p.

WH Smith also made strong gains in the FTSE 250 Index after it revealed that full-year profits will be at the top end of City expectations. The retail business, which climbed 4% or 245p to 606p, has been helped by strong book sales, including erotic best-seller Fifty Shades Of Grey.

The group has already returned £377 million to shareholders since mid-2007 and it said today it would extend this by another £50 million as a result of its latest resilient performance.
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