FTSE 100 ends 0.4% higher, holds onto 7,000 levels
FTSE 250 mid-caps edge lower
Pound falls against dollar to $1.2329
FTSE 100 shares eked out light gains but mid-caps ended softer in a non-event session on Tuesday as markets began winding down for the holiday season.
The blue-chip FTSE 100 was up 0.4% at 7043, with Carnival (LON:CCL, NYSE:CCL) leading the ticker after its earnings report.
The cruise ship operator posted higher revenue and profit in its fourth quarter but said low fuel prices, which have boosted results of late, likely would increase in the coming year.
Carnival, which is dual-listed in the US and the UK, has benefited in recent quarters from low fuel prices, higher prices and strong bookings. It said higher fuel prices for the next year would raise its fuel expenses by $200mln.
On Monday, the stock fell after Berenberg downgraded the stock to hold from buy. Read more.
Carnival shares closed up 3% at 4145p.
The mid-cap FTSE 250 ended down 0.07% at 17,769 and led by Polypipe Group plc (LON:PLP) down 4.1% to 309.4p on no specific news.
The FTSE AIM 100 Index ended down 0.03% at 3,973, led south by BNN Technology plc (LON:BNN) down 7.1% to 117.75p, and the FTSE AIM All-Share Index down 0.02% at 826.
But in some echelons of the small-cap culture there were gains too. The FTSE Smallcap index made some of the best percentage gains of the day, up 0.2% to 5082 and led by Volution Group plc (LON:FAN), up 9.3% to 172.75p after brokers at Canaccord Genuity reiterated the stock as a buy.
London gainers outnumbered losers 32% to 30%.
In forex markets, Sterling fell to a one-month lows against the dollar, with currency traders taking no comfort in the British prime minister Theresa May's first explicit remarks that she will seek a transition deal to smooth Britain’s EU exit. The Pound fell 0.6% against the dollar to $1.2329 - its weakest since Nov. 21.
1545 GMT - FTSE 100 quiet as markets wind down for Christmas
FTSE 100 up 14 points to 7,031
Recent terror attacks fail to put off investors
Quiet markets winding down for Christmas
Hurricane Energy continues its storming rise
3.45pm...Late movers
It’s been a fairly quiet day on the markets with the markets seemingly winding down for the holiday season.
The FTSE 100 managed to rally despite fears that recent terror attacks might hurt investor sentiment. It was up 14 points to 7,031 shortly before close.
In terms of some late movers in the small caps, Rockhopper Exploration Plc (LON:RKH) chirupped a more cheerful tune than of late as investors focused on its cash and decided its recent decline had gone too far.
The Falkland Islands-focused explorer said it expects to finish 2016 with around £65mln on the bank – which equates to more than two-thirds of the company’s current market capitalisation.
Trading Emissions PLC (LON:TRE), which last week sold off a chunk if its Italian solar portfolio, was also up after it announced its intention to pay shareholders a special divi.
The shares rose 0.5p to 4.5p as it said the distribution would be worth 2.5p a share.
That share price rise may sound a bit skinny, but the company had already signalled its intention to make a distribution to shareholders.
Another company selling stuff off is 1Spatial PLC (LON:SPA), the mapping database company, though in its case it looks a bit of a forced seller.
It has raised about £100,000 selling its Avisen business, as it said cash is a bit tight following delays to a few contracts.
The shares had almost a third sliced off their value at 1.875p, valuing the company at just £15.7mln.
12pm...
One might have expected the equity markets to take flight in the wake of terror attacks in Germany, Turkey and Switzerland.
Instead they traded sideways with the FTSE 100 up just under 6 points at 7,022.81.
The lack of movement, experts said, was more a function of the pre-Christmas lull than a sanguine acceptance of latest wave of atrocities.
“Equity indices are trading flat on another sombre post-terror attack day with markets shrugging off renewed geopolitical risk and travel stocks not suffering their usual knee-jerk weakness,” said Mike van Dulken, head of research at Accendo Markets.
While international lenders such as HSBC (LON:HSBA) and Barclays were on offer pending the rescue of Italy’s Monte dei Paschi, a home-grown rival was in demand.
Challenger bank Aldermore Group (LON:ALD) rose 2% after Deutsche Bank hiked its recommendation to ‘buy’ alongside its price target, which moves to 257p from 194p.
At 11am, the shares were changing hands for 233.36p each.
Hurricane Energy PLC (LON:HUR) enjoyed another day in the sun with stock up 2%. In the year to date, investors have enjoyed a 376% return on their investment.
The company has found two monster oil accumulations in the waters of Shetland Islands.
Trading Emissions PLC (LON:TRE), which last week sold off a chunk if its Italian solar portfolio, is to pay shareholders a special divi.
The shares rose 0.5p to 4.5p as it said the distribution would be worth 2.5p a share.
Another company selling stuff off is 1Spatial PLC (LON:SPA), the mapping database company, though in its case it looks a bit of a forced seller.
It has raised about £100,000 selling its Avisen business, as it said cash is a bit tight following delays to a few contracts.
The shares had almost a third sliced off their value at 1.875p, valuing the company at just £15.7mln.
CLICK HERE: To listen to Hurricane’s Robert Trice on the company’s latest success.
8.45am...flat start
The FTSE 100 got off to a quiet start as it appeared City traders had already packed up and gone home for the Christmas break.
At 8.30am the index of blue-chip shares was up just over a point at 7,018.
The mood was sombre following the truck attack in Berlin that killed 12, the shooting of the Russian ambassador in Turkey and the gun battle in Zurich.
The miners, banks and oilers led the losers’ board early on, Lloyds Banking Group (LON:LLOY) gained 1% in opening deals after agreeing to shell out £1.9bn for MBNA’s UK credit card book.
Among the smaller companies, satellite firm Avanti Communications (LON:AVN) was the stand-out performer, up 28% after it concluded a US$242mln refinancing.
6.45am....Footsie set to give back Monday's gain
Yesterday's gain on the Footsie was a mere six points, and it looks like it will be given back at the outset.
The top-share index is tipped to open six points lower at 7,011, meaning yesterday could have been more productively spent by all of us buying last minute Christmas presents.
US indices notched up moderate gains yesterday, with the S&P 500 advancing 4.5 points to 2,263 and the Dow Jones climbing 40 points to 19,883.
The bulls are hoping that the Dow will reach 20,000 before Christmas, and with volumes slackening off at this time of year it is possible this might be achieved, though whether the level would be sustained when trading volumes return to normal levels is another question.
Heading into the final stanza of trading, Asian markets were experiencing diverging fortunes.
In Tokyo, the Nikkei 225 was racing ahead, up 110 at 19,501.
In Hong Kong, the Hang Seng was 88 points weaker at 21,739, while Chinese stocks were also out of favour in Shanghai, where the Composite index was down 24 points at 3,094.
The scheduled corporate news flow from heavyweight companies is thin on the ground this week but the finance department at cruises operator Carnival PLC (LON:CCL) is one team that has not been able to sneak off for an early glass of advocaat.
In October, the group revealed it was expanding its operations in China, giving Carnival four cruise brands in the People's Republic - one of the planet's fastest-growing tourism markets.
The firm has been a benefactor, like others in the transport arena, of the weaker oil prices and therefore the lower cost of fuel.
The seas may be turning a bit rougher for the company, however.
Yesterday, German bank Berenberg didn't seem too cheerful about its prospects.
The broker cut its rating for the stock moving to 'hold' from 'buy' and reduced its price targets to £40 and $50, implying 4% downside.
It said: “We remain positive about the outlook for yields in the cruise industry going into 2017.
"However, recent trends in the cost of fuel, a further strengthening of the dollar and an increase in interest rates create head winds that we think will be tough for Carnival to offset.”
The broker expects Carnival’s yield growth to remain strong on a constant currency basis, improving by around 3% on 2016.
However, further appreciation by the US dollar since the company unveiled its third-quarter results at the end of September will mean reported yields are likely to be under 1%.
In addition, Berenberg noted that Carnival has already flagged that higher fuel costs will be a drag on earnings next year.
Berenberg said: “With fuel costs guided to be $926mln in 2016, this implied c$1.1bn at the time.
"We believe that this cost has risen by a further $150mln, with bunker fuel up by around c20% since the third quarter results."
Around the markets
- Sterling: US$1.2395, n/c
- Gilts: 10-year yield is 1.256%
- Oil (Brent crude): US$54.76 a barrel, down 6 cents
- Gold: US$1,136.90 an ounce, down US$5.80
Headlines
- Half of businesses see post-Brexit UK as worse place to invest and create jobs – The Independent
- Barclays is dropping 7,000 clients who don’t make them enough money – The Independent
- Airbnb’s UK tax bill scrutinised as accounts show it only paid £314,000 – The Independent
- Shell close to selling North Sea and Gabon assets – Financial Times
- Canada settlement adds C$2.1 billion to VW emissions bill – Financial Times
- AstraZeneca cancer chief resigns to head up Innate – The Times
- Banks could sue Brussels if it fails to cushion blow of Brexit – The Times
- Rupert Murdoch: ‘I don’t ask for anything from any Prime Minister’ – The Daily Telegraph
- Monte dei Paschi rescue thrown into turmoil – The Daily Telegraph
- Christine Lagarde avoids jail, keeps job after guilty verdict in negligence trial – The Guardian
- Ireland may not get Apple’s €13 billion back taxes in full, EU says – The Guardian
- Nintendo plunges as latest Super Mario game is panned by users and critics – Daily Mail
- Deutsche Bank to scrap bonuses in effort to ‘avoid collapse and new financial crisis’ – Daily Express
- BrewDog making leaps and bounds on turnover – The Scottish Herald
- Capita helps to maximise BBC licence fees and is awarded contract extension until 2022 – City AM
- Hurricane Energy’s share price storms higher after group announces “significant” North Sea oil find – City AM