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FTSE 100 ends week on a positive note; ITV is top riser

Last updated: 17:00 11 May 2018 BST, First published: 06:24 11 May 2018 BST

Kid watching the telly
  • FTSE 100 stages late surge to finish in the blue

  • ITV top Footsie laggard

  • Big UK utilities take a hit

The FTSE 100 ended the week on a positive note, although it left it late in the day to do so.

The FTSE 100 closed at 7,725, up 24 points on the day.

ITV plc (LON:ITV) led the advance on the back of a well-received trading statement at the company's annual general meeting.

The shares rose 7.3%, making them the best blue-chip performer.

Outside of the top bracket, ZPG Plc (LON:ZPG) shot up 31% to 490p following an agreed takeover by Silver Lake Management at 490p a share.

The terms value the owner of the Zoopla property search web site at around £2.2bn.

3pm: Footsie come-back ...

FTSE 100 is making a come-back in afternoon trade and looks set to close up near 2% on the week.

At the time of writing, with around two hours to go before the close of trade, the premier index of leading UK shares is up 4.77 points at 7,705.

FTSE 250 is also higher, up over 44 points at 20,743.

On Wall Street, the broad-based S&P 500 is up over 51 points at 2,723, while the Dow Jones Industrial Index is ahead by 196 points.

Craig Erlam, at Oanda.com, said: "It’s been a relatively calm start to trading on Friday, bringing an end to what has actually been a similarly quiet week, despite the US’ decision to withdraw from the Iran nuclear deal.

"From a markets perspective, the reaction to Donald Trump’s announcement was primarily felt in oil prices and energy stocks and didn’t have a detrimental impact on wider risk appetite, which is not surprising given how indifferent they’ve been to geopolitical events in recent years.

"Even oil prices have now stabilised after hitting three and a half year highs in recent days as traders try to determine how significant an impact sanctions will have on oil output."

Top riser on Footsie was broadcaster ITV (LON:ITV), whose shares added 6.27% to stand at 10.15p after broker heavyweight JPMorgan hiked its price target on the stock.

Analysts at the giant investment bank said the group's valuation was attractive and its viewing share was growing.

On the losing front, utilities were hard hit, as European stocks in the sector also fell yesterday. United Utilities Group (LON:UU.) shed 2.79% to 759.40p and was top Footsie loser.

12.15pm: FTSE 100 slips into the red

FTSE 100 has slipped into the red at the mid-session point, down over eight points at 7,692.

Traders appear to lack direction after disappointing growth reports and the Bank of England's continued lack of movement on interest rate rises.

In Wall Street futures, markets are pointing higher, after a higher close yesterday, which saw the Dow Jones add 196 points to 24,739, while the S&P 500 gained over 25 points to 2,723.

Dow futures are up 55 points at the time of writing, while S&P 500 futures are ahead by over six points.

In company news, Interserve PLC (LON:IRV) shares are down 2.13% to 75.36p as the company faces a regulatory probe into how information on its exit from its energy-from-waste business was released.

Interserve has received a formal notice of referral to the Financial Conduct Authority’s enforcement division for its actions during the period from 15 July 2016 to 20 February 2017.

At the end of last year, the company issued a profit warning and there were fears it would break its covenants, and since then shares have struggled. Friday's announcemnet did little to improve investor confidence.

Elsewhere, gold giant Randgold Resources Ltd (LON:RRS)  zipped up 1.76% to 5,774p after shares got hit Thursday when it reported a 24% drop in first-quarter profit, largely on account of industrial action.

The mining company said it was on track to achieve its full-year target and now that the dust has settled, investors are bargain hunting.

11.25am: Npower lifts prices

'Big six' energy provider Npower has become the fourth to push up costs this year.

The group is now hiking bills by an average of £64 a year for 1mln customers, with a 5.3% increase to the average cost for dual fuel.

The rise is made up of an average rise of 4.4% on gas and 6.2% on electricity, it said.

The provider said it was required because of the rise in energy wholesale costs and Government taxes.

In April, British Gas revealed a rise, a month after E.on did. Scottish Power is also lifting prices by 5.5%, adding £63 onto bills from June.

11am: RBS shares higher as it  reveals it could close more branches

State-owned lender Royal Bank of Scotland PLC (LON:RBS) could close more branches due to transferring customers to competitors from its Williams & Glyn unit, according to chief executiveRoss McEwan.

Shares in RBS added 1.95% to 292.10p.

About 120,000 small business customers are being transferred to rivals as part of a deal, RBS made with the European Commission to boost competition in the sector following its £45.5bn government bailout in 2008.

10.30am: FTSE 100 holding nose above water

FTSE 100 tripped into the red in the morning session briefly but then recovered as traders seemed unsure which direction to jump.

Big utilities, seen as defensive stocks, were under pressure with Severn Trent PLC (LON:SVT) down 2.82% to 1,963p, and National Grid PLC (LON:NG), off 838p.

 

Fiona Cincotta, senior market analyst at City Index, noted that UK utilities were "generally not the best loved stocks on the London market", and that sentiment had not been helped by a similar decline among such firms in European markets yesterday.

The FTSE 100 is currently up just 1.35 points at 7,702 but could still be on track for record highs next week. Meanwhile, midcap cousin FTSE 250 is faring even better -  up over 107 points to 20,806.

The top riser on Footsie was broadcaster ITV plc  (LON:ITV), which added 3.87%, still basking in its better-than-expected update yesterday, with the shares advancing 1.5%.

Notable movers were property focused stocks. Rightmove (LON:RMV) added 6.24% to 4,890p, while Zoopla parent ZPG (LON: ZPG) and FTSE 250 constituent surged over 30% to 488.8p. OnTheMarket PLC (LON:OTMP) added 5.76% to stand at 147p.

Earlier, it emerged that US private equity group Silver Lake was buying Zoopla and PrimeLocation owner ZPG for £2.2bn, meaning a big windfall for its largest shareholder, the Daily Mail publishing group.

Back to the big caps of Footsie and Russ Mould, investment director at AJ Bell, said: "The FTSE 100 is on track to end the week nearly 2% ahead, given its current position of 7,700 in early trading on Friday. Maintaining this pace of growth would put the blue chip index at new record highs early next week."

 

9am: Interest rate hike in May was conditional, says BoE deputy governor

The UK central bank never said it would raise rates in May, according to deputy governor of the Bank of England Ben Broadbent in a radio interview.

The bank kept interest rates at 0.5% yesterday following much talk of potential rises this year.

"If you read what we said in the early part of the year it was clearly a conditional statement. It says if the economy turns out in line with the forecast then interest rate rises may come sooner than people expected," he said, talking to Radio 4.

He noted that first quarter inflation and GDP growth came in lower than expected.

8.45am: Footsie becalmed ...

The FTSE 100 was becalmed as it  nudged just 1.45 points higher to 7,702.42 with traders resisting the positive momentum provided by Wall Street.

Even so, market commentators expect to post a strong weekly gain, providing a near 800-point boost to the index since it hit its nadir in late March.

The resurgent price of crude and its knock-on impact for the listed UK oil stocks has made an impact as has the weak pound, particularly for those companies earning income outside the UK.

On the market, the miners were in demand, led by gold digger Randgold Resources (LON:RRS), which was up 2%, though interest extended to major BHP Billiton (LON:BLT) and silver specialist Fresnillo (LON:FRES) too.

There was continued buying interest in ITV (LON:ITV) after its better-than-expected update on Thursday, with the shares advancing 1.5%.

Dropping down a division, the day's big riser, up 30%, was ZPG (LON:ZPG), the owner of online estate agent Zoopla. It has received a £2.2bn bid approach from private equity firm Silver Lake.

Proactive news headlines:

Advanced Oncotherapy PLC (LON:AVO) has received the first payment relating to its exclusive distribution agreement with partner company Yantai Cipu. The AIM-listed cancer treatment developer said the £6.5mln payment from Yantai had been received through its affiliated entity Liquid Harmony, with the remaining balance of £10mln to be received in the coming weeks.

Westminster Group PLC (LON:WSG) confirmed last night that its long-awaited airport security contract had put been on hold due to the US withdrawal from the Iranian nuclear deal. The security group had not previously identified the country but confirmed last night the contract was for one of Iran’s 60 airports.

Faron Pharmaceuticals Limited (LON:FARN) said early follow-up analysis of its unsuccessful Phase III clinical trial suggests the treatment did not produce the expected interferon-beta bioactivity seen in the Phase I/II study. The company said it is still too early to understand why this was the case, but it cited a number of possible causes. It is investigating the formulation of the drug, its administration and deactivation.

Avation PLC (LON:AVAP) has announced that it has extended the lease for an Airbus A320 aircraft by a further seven years. The company said the lease for the aircraft was due to expire on 18 May 2018 but has now been extended to 18 May 2025 with the existing operator.

Six new wells have been spudded at Highlands Natural Resources PLC’s (LON:HNR) East Denver oil and gas project in the US state of Colorado. Work began on the wells – named Buckskin, Citadel, Hagar, Ouray, Thunder and Grizzly – last month and was funded by Highlands’ partners at the project.

Canadian Overseas Petroleum Ltd (LON:COPL) (CVE:XOP) highlighted “significant progress” as it released an update for the first quarter ended March 31. The oil and gas junior is working on a financing package for OPL 226 for its appraisal and development project offshore Nigeria, as well as the required necessary government consents.

Falcon Oil & Gas Ltd (LON:FOG, CVE:FO) highlighted its strong position as it filed interim financial statement for the three months ended March 31. The company boasted a cash position of US$8.5mln and noted that it is debt free.

Lionsgold Limited (LON:LION)  shares will be suspended from the start of London trading today following its acquisition of TRAC Technology, which is now called Goldbloc Limited. As revealed last month, the firm has 55% of TRAC Technology, which has developed Goldbloc digital currency, and has now made a £1.35mln share-for-share offer to the remaining shareholders.

SDX Energy Inc. (LON:SDX) (TSXV:SDX), the North Africa focused oil and gas company, hosted a call for private investors at 9am BST on Friday 18 May 2018. The group said its management will provide an operational update on its Egyptian and Moroccan assets on the call.

6.45am: Footsie expected to nudge higher

The FTSE 100 is expected to open marginally higher on what looks to be a quiet end to the week after Asian shares rose overnight, tracking Wall Street gains.

The UK blue-chip index closed over 38 points up on Thursday, as is usually the way when the pound falls, to finish at 7,700. Today, it is called by spreadbetters at IG Index to open around five points higher than that level.

"The pound had a pretty disappointing day yesterday, coming under pressure over a combination of multiple downgrades in the UK’s growth as well as inflation outlook, after the Bank of England kept rates on hold," said analyst Michael Hewson at CMC Markets.

"While governor Carney attempted to put a brave face on the downgrades by suggesting that rate hikes still remain on the table for this year, and that the bank expected the slow down seen in Q1 GDP to be temporary, markets didn’t appear to be buying the narrative on this occasion."

In the US, the Wall Street rally continued, with the Dow Jones finishing 196 points ahead at 24,739, and the S&P 500 adding 25 points to 2,723.

That prompted Asian shares to gain, along with the continued crude rally, with the Hang Seng Index in Hong Kong adding 418 points to 31,227. The Nikkei 225 in Japan added 207 points to 22,704.

In London today, there looks to be a quiet day in store. On the results side, alloys producer Afarak Group PLC (LON:AFRK) is due to report its first-quarter numbers.

But investors already have a pretty good idea of what to expect after the firm, issued a disappointing trading update last week.

The company blamed a drop in benchmark chrome prices, higher production costs and a weak US dollar as it warned investors to expect an underlying loss (LBITDA) of around €1mln in the opening quarter.

Significant news expected:

Trading update: BBA Aviation PLC (LON:BBA)

Interims: Afarak Group PLC (LON:AFRK)

Finals: Harbourvest Global Private Equity (LON:HPVE)

Economic data: US import, export prices; University of Michigan consumer sentiment index

Around the markets:

  • Sterling: US$1,3528, up 0.09%
  • Gold: US$1,320.80 - flat
  • Brent crude: US$71.32 a barrel, down 0.06%

City headlines:

  • BT to axe 13,000 jobs and quit London HQ in cost-cutting drive- Telegraph
  • Monarch's demise causes £1m profit hit to online travel agent On The Beach – Telegraph
  • Dropbox beats forecasts in maiden results as paying subscribers jump 24% – Telegraph
  • Apple and Goldman Sachs 'to launch joint credit card' -Telegraph
  • Deloitte is sacked after vote by SIG investors - The Times
  • UK firms face action over failure to report gender pay gap - The Guardian
  • RBS settles US Department of Justice investigation with US$4.9bn fine - The Guardian
  • Apple scraps €850m Irish data centre after planning delays - The Guardian
  • Melrose shareholders revolt against directors' £42mln bonuses - The Gurdian
  • Sarah Beeny's online estate agent Tepilo set to merge with rival eMoov to create a challenger to Purplebricks - Thisismoney

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