Belfast Telegraph

Wednesday 3 September 2014

Investors kept waiting on debt deal

The FTSE 100 Index was under pressure today after investors were kept waiting on a deal to prevent the US defaulting on its debt.

The London market came under further pressure today as US politicians remained locked in talks over their fiscal stalemate with tomorrow's debt deadline looming.

Ratings agency Fitch added to the woes as it warned late yesterday it could strip the US of its prized AAA rating due to the threat of the world's largest economy defaulting on its debt.

The FTSE 100 Index edged 15.2 points lower to 6533.9 despite optimism among Senate leaders over an eleventh hour deal to end the partial government shutdown and agree plans to raise America's £10.5 trillion debt limit.

The Dow Jones Industrial Average on Wall Street ended 0.9% lower overnight, followed by falls on Asia.

Among stocks, Royal Mail lost some of its post-flotation froth, down 3% or 14.5p to 474.5p - although investors are still enjoying a rise of more than 40% on the Government's price tag last week.

Engineering group IMI led the FTSE 100 Index higher after striking a deal to sell its beverage dispense and merchandising business to US billionaire investor Warren Buffett's Berkshire Hathaway for 1.1 billion US dollars (£688 million).

The group will return £620 million to its shareholders following the sale, which saw shares rise 36.5p to 1535.5p.

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