Gloomy comments from consumer products firm Unilever and Dutch brewer Heineken pushed British blue chips to session lows today, as investors worried more bad news might be around the corner.
The FTSE 100 blue-chip index was down 37.2 points, or 0.89 per cent, at 4,122.9 by 1357 GMT - near a trough of 4,122.4 and taking away all of Friday's gain. The mood was also subdued on Wall Street, where the Dow Jones industrial average fell 0.66 per cent in early trade.
Unilever was the worst blue-chip performer, slumping 10 per cent after the Anglo-Dutch firm cut its 2003 sales growth target for top brands such as Knorr, Hellmann's, Dove and Lux.
Meanwhile, a profit warning from Heineken which pushed its shares down 11 per cent filtered through to UK brewing stocks. Scottish & Newcastle dropped 4.3 per cent, drinks group Diageo lost 3.5 per cent and SABMiller fell 3.3 per cent. Among second liners, technology stocks were the main fallers. Traders said a dose of reality had come back to the sector after a recent strong run.
But building materials firm RMC was a bright spot, up 3.24 per cent as the market smiled on Friday's news that it had sold waste management firm Hales to water utility Severn Trent Plc for 141 million pounds.