Market report: Monday close

THERE is little sign of festive spirit or a prosperous New Year on the High Street.

At least that was the view in the City today as shares in the major retailers came under pressure. Word is the consumer stampede has failed to live up to expectations and the early start to 'January' sales means margins among the fashion chains are being squeezed.

Britain's biggest clothes retailer, Marks & Spencer, was the biggest faller among the top 100 companies. Its shares fell 6 1/2p to 276p with a line of 15m going through on the ticker at 274 1/2p. Weekend reports claimed it has been losing market share to the likes of Next, down 12p at 1088p, and Debenhams.

Leaked market research says its clothing sales have fallen as much as 10%, with the group losing about 3% market share in the 12 weeks to mid-November.

There were losses for Dixons, down 1 3/4p at 134 1/4p, Boots 1 1/2p at 688p, and Kesa Electrical, 3 1/4p at 268p. Woolworths marked time at 44 1/4p after a line of 2.27 million shares went through at 43 1/2p.

Institutions were switching out of retailers and into oil shares such as Shell, up 3 1/4p at 410 1/4p, despite news of an $820m (£476m) write-off in the final quarter.

The wider market extended Friday's 16-month high. The festive season is now in full swing on markets and, in desperately thin trade, the FTSE 100 index rose 11.7 points to 4424.00.

Back where it belongs - in the top flight - was the view of City investors today as British Airways returned to the Footsie.

After an absence of nine months, the national carrier was reselected in this month's quarterly review of the constituents of the blue-chip index.

This is the third time BA has been promoted to the Footsie in the past 18 months. It follows a turbulent few years that have seen it rack up big losses on the back of increased competition from discount airlines, the aftermath of the 9/11 terrorist attacks, the Iraq war and this year's outbreak of the killer Sars virus in the Far East.

The share price hit a low of 86p in March when BA's stock market value slumped to just £1bn. Since then, the price tag has shot back up to £2.38bn, slotting it into 80th place in the index by market value. Today, it was 3 1/4p lighter at 238 1/4p. It has been joined in the Footsie by recruitment services group Hays, 1 1/4p lower at 120 1/2p.

They replace Provident Financial, up 11p at 632p, and Mitchells & Butlers, 5p better at 230p.

Shareholders in Ebookers must have thought Christmas had come early as the price soared from 200 1/2p to 390p. Some 'fat-fingered' trader had entered a wrong price late on Friday.

Water utility Pennon hardened 9p to 669p in thin trading after broker UBS Warburg downgraded it from buy to neutral. But it has retained its target price of 730p.

South African financial services group Old Mutual fell 3/4p to 93p following an embarrassing profits warning. Old Mutual blames the setback on losses at 53%-owned subsidiary Nedcor.

Speculative buying drove up Premiership football club Leeds United a further 1/4p to 5 3/4p ahead of tomorrow's annual general meeting. Several competing consortiums are believed to be putting together bid financing.

Computer software specialist Innovation shaded 1/2p lower to 23p after a line of 3.69 million shares went through at 22.93p on Friday.