Shares lower as disappointing company earnings weigh

Shares put in a lacklustre early performance as earnings disappointments on both sides of the Atlantic weighed.

The FTSE 100 was lower again, down 5.2 points at 5143.

In the US last night, shares staged a late rally and the DJIA closed up 56.6 points, or 0.56%, to 10,154 and the S&P 500 added 6.4 points to 1,071.

Disappointing updates from tech giants IBM and Texas Instruments dampened recent hopes that corporate earnings could boost shares even as economic data disappoints.

IBM beat earnings forecasts but failed to meet sales expectations and Texas Instrument's numbers disappointed on both lines.

Investors remain nervous ahead of yet more US housing data later after weak data yesterday.

In the UK, Public finance figures later are expected to show some improvement compared to recent months as tax receipts will be less of a drag and higher VAT receipts and lower benefits payments help.

On the corporate front, telecoms group Cable & Wireless Worldwide dropped 12.6% to 72.95p after it issued a profit warning; saying government cutbacks will weigh on its business.

'Following the new Government's Emergency Budget in late June, non-contracted spending in the UK public sector has slowed very significantly.  Given the nature of our public sector business, this reduction will adversely impact trading in the current year,' the group said, in a brief statement.

It said it will cut costs to help offset the lost revenue.

Last month, social housing repairs group Connaught issued a profit warning that wiped a third off the value of its shares, saying it had lost business as a result of the emergency budget.

Vodafone was 2p lower at 142.6p after ING downgraded the mobile phone group to 'hold' from 'buy'.