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FTSE edges higher, small caps help London record 40% gainers, miners sink

Last updated: 17:30 22 Dec 2016 GMT, First published: 06:57 22 Dec 2016 GMT

Sprouts
  • FTSE perks up but miners are buried

  • Small-caps drive gains

  • 40% of London stocks gain

  • Pound drops 0.5% against dollar to $1.2296

FTSE 100 stocks ended higher on Thursday after pulling away from flat positions at midsession while small-caps helped 40% of London’s stocks to gain – one of their best performances this year -  but falling prices for copper, zinc and nickel put pressure on mining shares.

The price of copper hit a one-month low after a report showed that Chinese metal imports slowed sharply in November.

The blue-chip FTSE 100 ended up 0.3% at 7063 and led by the business consultancy group DCC (LON:DCC), which rose 3.6% to 6070p after favourable broker notes. Goodbody reaffirmed its hold rating of DCC as did BNP Paribas with a neutral rating. Two days ago DCC completed the takeover of Hammer Consolidated Holdings Limited.

Although a rocky day for mining stocks, no pun intended, Fresnillo (LON:FRES) managed to advance to be the third-highest riser on the FTSE 100. Its shares ended up 2.8% at 1124p.

Similarly, Randgold Resources (LON:RRS) closed up in the top five, rising 2.5% to 5790p.

But overall, it was a bad day for miners. Top faller on the index was BHP Billiton (LON:BLT) down 1.6% at 1270.5p, followed by Rio Tinto (LON:RIO) down 1% at 3081p. Behind Barclays in fourth place was Anglo American (LON:AAL) down 0.8% to 1126p. Also in the bottom ten was Antofagasta Holdings (LON:ANTO) down 0.4% to 672p.

Mid-caps had a more solid day of gains, and the FTSE 250 ended up 0.8% at 17,891 and was led by IP Group Plc (LON:IPO) up 8.3% to 169p.

Among small-caps, the FTSE AIM 100 Index ended up 1% at 3,996 and the FTSE AIM All-Share Index up 0.8% at 831.

Top gainer on the FTSE AIM 100 was M P Evans Group Plc (LON:MPE) up 30.6% at 640p. Indonesian palm oil plantation owner MP Evans has confirmed that the 740p per share offer made by Kuala Lumpur Kepong Berhad lapsed on Wednesday after it failed to secure enough support from the company's shareholders.

MP Evans said it welcomed the rejection by shareholders - the offer only managed to get 13.2% support - which it believes substantially undervalues the shares. The offer would have needed 50% acceptance to proceed.

But in spite of the light gains by the blue-chips, overall the London market saw a very healthy 40% of the market gain while only 21% of stocks’ share prices fell.


1200 GMT - FTSE 100 flat, but mid caps on fire

  • FTSE 100 off 2 points at 7,039

  • US stocks seen flat despite Q3 growth revision

  • Miners sufffer as metal prices retreat

  • But mid-caps strong, with FTSE 250 up 112 points at 17,857

2.00pm … Grinch still in charge …

The Footsie stayed as flat as a run-over sprout in afternoon trading, as Christmas cheer remained in short supply, with Wall Street also seen moribund even though US third quarter GDP growth data got revised higher.

At 2pm, the FTSE 100 index was up just 2 points at 7,039, while futures for the US Dow Jones Industrial’s benchmark edged lower as any thought of a pre-Christmas assault on the 20,000 level faded again.

Naeem Aslam, chief market analyst at Think Markets UK Ltd, said: “The US final GDP revision data was much better than expected. This certainly provides some ammunition for the Dow to have another go at the 20K mark.”

“However,” he added, “the US durable goods number was a little weak as compared to forecast. This may just bring a balance between good and bad news.”

12.00pm … Footsie in a hole

The Footsie remained lower around midday as the pre-Christmas lethargy continued, with falls by miners weighing after data showed metal imports to top commodity consumer China dropped sharply last month.

Approaching lunchtime, the FTSE 100 index was around 7 points lower at 7,033, while on currency markets the pound slipped back to US$1.2335, down around 0.1%.  

David Cheetham, market analyst at XTB.Com, said: “The worst performing stocks on the leading UK index this morning come from the mining sector with Glencore PLC (LON:GLEN), Rio Tinto PLC (LON:RIO)  and BHP Billiton plc (LON:BLT) all seeing some weakness.”

He added: “All three have enjoyed stellar rises in 2016 and it is quite possible that some investors are looking to book profits and take some money off the table before year end.”

Mid caps stocks, however, outperformed their blue chip peers, with the FTSE 250 index up over 100 points at 17,846.

Car dealer Inchcape (LON:INCH) was the top mid-cap gainer, jumping more than 5% to a 2-month high after expanding its business in South America.

08:45am ... Banks spanked 

The last full trading day before the Christmas break promises to be fairly dull one if the opening of the FTSE 100 is anything to go by.

For the index of blue-chip stocks fell 8 points to 7,033.29 in the first half hour on very little volume.

It looks to be all over bar the shouting for Monte dei Paschi di Siena, Italy’s oldest bank, which is destined to be bailed out by the state.

On Wednesday it confirmed it had failed to secure an anchor investor for its £4.2bn cash call.

At the same time the country’s parliament was signing off a £17bn rescue fund for beleaguered lenders.

“European banking stocks are expected to remain under pressure,” said Ipek Ozkardeskaya, senior market analyst at London Capital Group.

“The Italian banking crisis is enhanced by mounting tensions in Spanish banks, which are now due to pay billions of euros on mortgage deals after they lost the EU case over mortgage floor clauses.

“Finding a solution to rescue Monte Paschi could trigger a short-term relief rally in the sector, yet the European banks will certainly remain on a slippery ground for a longer period of time.”

Back in the UK, end-of-year profit-taking led the miners lower with the money seemingly being switched into the more defensive drugs stocks.

Among the tiddlers, ImmuPharma (LON:IMM) was up 10% after the company said it had successfully recruited the requisite number of patients to its phase III clinical trial of a treatment for lupus. Success would be transformational.

The market wasn’t too enamoured of the latest results from Koovs PLC (LON:KOOV), the India-focused online fashion business chaired by Labour life peer Waheed Alli. The shares were off 9% in early deals.

6.45am ... FTSE 100 tipped to go lower

London is tipped to open lower on what is likely to be a very slow day ahead of the long holiday break.

Spread bet firms see FTSE 100 shedding around 20 points in early trades and mirroring falls in the US and Asian markets overnight. FTSE 100 closed down 2 yesterday at 7,021.

In the US, the Dow Jones Industrial Average once again found the 20,000 mark a few points too far and ended the day 32 lower at 19,941.

There is a raft of economic statistics due in the US today but unless there are major changes in inflation, jobless claims or durable goods the hunker-down mood looks set here as well.

Asian markets were generally weak with Hong Kong the worst performer Tokyo flat while Shanghai added a couple of points.

City Headlines

  • The man being sought in connection with Monday’s attack on a Berlin Christmas market had been under police surveillance for months on suspicion of planning a terrorist attack, but later fell off the authorities’ radar screen, makes the FT lead story and that of the other papers.
  • A former fund manager at the world’s biggest investment firm has been sentenced to a year in prison for insider trading. Mark Lyttleton, 45, who used to work at BlackRock, appeared at Southwark Crown Court today, where he was handed an 18-month sentence that was reduced by six months, reports the Telegraph.
  • Goldman Sachs has been rapped by the US derivatives regulator and ordered to pay a fine of $120m over claims that its traders tried to rig the the $300trn market for interest-rate swaps, reports the FT
  • President Obama has outlawed offshore oil and gas drilling across large areas of the Arctic and Atlantic in a last-ditch effort to thwart Donald Trump’s promises to exploit new fossil fuel sources, writes theTimes
  • Aquascutum, worn by the Queen Mother, Sophia Loren, Humphrey Bogart and Cary Grant, is to be bought by two buyers for $120 million, according to YGM Trading, its Hong Kong-based owner, writes the Times.
  • Businesses are growing at their fastest pace of the year, as strong consumer growth and recovering confidence gives the economy some Christmas cheer according to the Confederation of British Industry, reports the Telegraph.
  • Skiers desperate to get away this Christmas are turning to private jets as the threat of airline strike action looms, claims aviation firm Air Partner. The group, which charters luxury planes, said inquiries have been particularly high for Swiss and French skiing destinations, reports the Mail. 

Commodities/Currencies

$/£ - 1.236 pound strengthens a little

Gold - US$1,132 up US$1

Oil (WTI) -  US$52.48 flat

 

 

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