UK stocks fall as optimism ebbs

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By Reuters

Britain's top share index fell on Friday, the final full trading session before Christmas, tracking falls by US futures as optimism regarding a key deal on the US budget ebbed.

US Republican lawmakers have rejected party leader John Boehner's proposal designed to win concessions from President Barack Obama in the “fiscal cliff” talks, reviving fears of $600 billion worth of tax hikes and spending cuts that could drag the US economy back into recession.

At 10:03 SA time the FTSE 100 index was down 27.42 points, or 0.5 percent at 5,930.92, having closed 0.05 percent lower on Thursday, stalling around nine-month highs in its pursuit of the psychologically important 6,000 points mark.

Early trading is predicted to be volatile ahead of the expiry of December options, due around 12:15 SA time, which might galvanise the market into trying another assault on 6,000 - last seen in July 2011 - given a concentration of bets around that level. - Reuters

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