London’s blue-chip stocks took a pounding in early deals, after European Central Bank president Mario Draghi forecast faster euro-area inflation and said market volatility will continue.
The global bond market has erased all of the gains it had made so far this year, and Draghi did little to settle nerves in Europe, telling investors to get used to the increased volatility.
Investors are also watching with caution for any news of a Greek debt deal with tomorrow’s payment to the International Monetary Fund unlikely to be paid without financial support from its creditors.
Meanwhile in the US, influential monthly US employment stats are released tomorrow with some hopeful for good news after figures showed private sector hiring, a marker for the non-farm data, had improved.
Wall Street’s main indices ended Wednesday higher; the Dow Jones gained 0.35% to 18,076 while the S&P 500 added 0.2% and the Nasdaq performed best rising 0.45%.
Back in the UK, the FTSE 100 was 91 points, or 1.3%, lower to 6,906 by mid-morning.
Platinum refiner Johnson Matthey (LON:JMAT) was the biggest faller on the index, easing almost 3.7% to 3,386p after it released its end of year results.
While most areas of the business performed well, precious metal product sales fell 9% and underlying profit for the sector dropped 21% on weaker markets and the sale of its gold and silver refining business.
At the other end of the index, Kingfisher (LON:KGF) was at the top of the pile after an upgrade to ‘neutral’ from ‘underperform’ by Bank of America Merrill Lynch. Shares rose 1.5% to 373p.
In the mid cap space, city traders continue to speculate that Paddy Power or private investors could table a 175p per share offer for Ladbrokes (LON:LAD).
Shares in Ladbrokes rose for a second straight day, climbing 2% to 124p.
Meanwhile, Moneysupermarket.com Group (LON:MONY) shares fell after the price comparison website said the U.K. energy regulator was looking into whether to include it in a competition probe. Shares dropped 9% to 278p.
The could also look at at uSwitch, which home seller Zoopla (LON:ZPLA) officially acquired earlier this week for £143mln in initial cash. Shares in Zoopla dropped 8.6% to 250p.
In small caps, IT developer Scisys (LON:SSY) has issued a severe profit warning today while admitting it may breach its banking covenants. Shares plummeted 30% to 56p.
Elsewhere, South American copper explorer Metminco (LON:MNC ASX:MNC) announced today it has raised an extra A$200,000 (£100,574) from its rights issue on 1 April.
Shares have almost doubled this week and after an early 20% drop, shares recovered to sit 3% down by mid-morning.
Conversely, there was better news for 88 Energy (LON:88E) after the company said excellent drill results had been reported near to its Icewine site in Alaska. Shares rose 26% to 0.9p.
Midatech (LON:MTPH) will significantly increase its footprint in the US and in cancer care with the acquisition of Nasdaq-listed DARA Biosciences for up to £19.5mln. Shares rose almost 5% to 305p.