FTSE closes down as doubts remain about Greek bailout

The FTSE 100 closed down today after investors remained unconvinced by the Greek bailout deal.

London’s blue chip index closed down 17.05 points, or 0.3 per cent at 5,928.20, retreating from a seven-month closing high it reached on Monday following high expectations for the Greek deal.

Having risen 6.5 per cent since the start of the year, bolstered by liquidity injections from global central banks and improved risk appetite, the FTSE is approaching overbought territory on the relative strength indicator.

Low turnover underlined investors’ cautious mood, with volumes on the FTSE 100 coming in at 93 percent of the 90-day average.

Euro zone policymakers agreed a €130bn rescue for Athens, enabling it to meet bond payments due in March.

With the widely expected deal done, investors switched their focus to the remaining deep doubts about Greece’s ability to recover and avoid a default in the longer term, as well as risks of contagion to other countries.

Shell was one of the few gainers on the FTSE, up 0.8 per cent, as higher oil and metal prices boosted energy firms and miners.

Banks were the biggest weight on the FTSE, with Barclays down 1.3 per cent and RBS 1 per cent lower.

Cyclical companies, which do well at times of economic strength, also suffered with International Airlines Group and advertiser WPP each off 2 per cent.