BT shares slump as top banks see-saw again.

Byline: David Jones

HEIGHTENED volatility continued in the banking sector yesterday with Barclays and Royal Bank of Scotland shares see-sawing in another tough session for the sector.

RBS swung between positive and negative territory, while Barclays remained in the red, although Lloyds Banking Group held firm in positive territory at the head of the risers board.

Heavy falls in early trading on Wall Street saw the wider FTSE 100 Index close down 7.7 points at 4052.2.

In London, Barclays was the biggest faller, down 10% or 6.9p at 59.2p, having earlier dipped only 0.9p, while RBS closed down 0.3p at 12.2p, having risen as much as 16% at one stage.

Barclays was suffering amid speculation that any further capital raising initiative could trigger a clause that would hand control of the bank to its Middle East investors.

Among other banking stocks, HSBC rose 11.5p to 527p and fellow Asian-facing bank Standard Chartered lifted 4%, or 34p to 800p.

The biggest corporate news of the session came from telecoms giant BT Group after it warned of a pounds 340m one-off charge from its under-performing Global Services division.

Shares slumped 9% or 11.2p to 111.8p, as the stock returned to the 20-year low seen in October.

Supermarket group Morrisons was also lower despite posting healthy Christmas trading figures.

MICROSOFT is to axe up to 5,000 jobs, 1,400 of them immediately.

The computer giant said the rest will go over the next 18 months, after it suffered an 11% drop in net income for its last quarter compared with the previous year.

The losses involved less than 2% of its UK workforce of around 2,900 - fewer than 60 people, according to the company.

The firm's UK staff work out of offices in London, Reading, Manchester, Edinburgh, Cambridge and Chertsey, Surrey.