FTSE 100 marks fresh record
FTSE pares gains as US markets turn negative
Persimmon boosts housebuilders
Pound stable against US dollar at $1.2422
FTSE 100 stocks hit a fresh record high intraday on Thursday before slipping into the close as US shares turned soft.
The new high was 7,211.96 – a technical gain on the previous all-time high. The blue-chip ticker ended up 0.08% at 7,195.
The gainers were led by housebuilder Persimmon (LON:PSN) which reported strong sales growth.
The company said private sales in the second half of 2016 were up 15% from a year earlier.
For the year as a whole, it completed the sale of 15,171 homes, a rise of 4% - suggesting that sales were held back in the first half of the year by the looming Brexit poll - while revenues climbed 8% to £3.14bn. Persimmon shares ended up 7.2% at 1940p.
Behind miner Fresnillo (LON:FRES) up 6.4% to 1398p, were other housebuilders Taylor Wimpey (LON:TW.) up 5% to 169.4p and Barratt (LON:BDEV) was another top ten riser, up 2.8% to 497.5p.
Rolls-Royce (LON:RR.gt;) was the worst performing share in the FTSE 100. It fell 4.2% to 639.5p after broker JP Morgan reduced its price target for the stock.
The mid-cap FTSE 250 closed up 0.9% at 18,308 and led by double-digit gains for Nostrum Oil & Gas PLC (LON:NOG) up 14% to 445.7p, Hochschild Mining Plc (LON:HOC) up 12.3% to 238.7p, and Acacia Mining plc (LON:ACA) up 10.2% to 411.5p.
The FTSE AIM 100 Index ended up 0.6% at 4127 and the FTSE AIM All-Share Index up the same at 858.
Some 38% of London stocks gained and 28% declined.
1530 GMT - FTSE 100 hits new all-time high but slips back from its best
FTSE 100 up 19 points at 7,209
Benchmark hit new intra-day peak of 7,211.96 earlier
Persimmon leads housebuilders higher after trading update
Retailers remain blighted by Next profit warning yesterday
3.30pm … New record …
The Footsie shook of its earlier torpor in late afternoon trading to hit a fresh all-time peak even though US stocks made a mixed start today ahead of some key data.
The FTSE 100 index reached a new high of 7,211.96, exceeding the level it hit on Tuesday, the first session of 2017, but slipped back slightly later, adding 19 points at 7,209.
On Wall Street, the Dow Jones was almost flat after half-an-hour of trading, having drifted lower at the open as traders digested a batch of US economic pointers ahead of tomorrow’s key US jobs report.
Connor Campbell, financial analyst at Spreadex, said: “Both US services PMIs surpassed expectations, with the Markit reading revised higher to 53.9 and the ISM avoiding the anticipated dip at 57.2, while the usually dull jobless claims number provided a bit of unlikely intrigue after arriving at a near 43 year low.
“Only the ADP non-farm employment change reading disappointed, at 153k against the 171k forecast and the 215k seen last month.”
However, he added: “Yet none of this mattered to the demure Dow Jones, which continued to struggle to find the record-breaking momentum it had oodles of before the Christmas period began.”
In London, the housebuilders continued to make the pace, lifted by an upbeat trading statement from Persimmon PLC (LON:PSN), with the stock topping the FTSE leader board, leaping 10% to 1,938p.
But the retailers remained the market laggards, led again by clothing and homewares store group Next Plc (LON:NXT), which dropped another 15% to 4,039p following yesterday’s profit warning and weak Christmas trading update.
12.30pm …Tick back …
The FTSE 100 was almost flat around lunchtime, paring back earlier modest highs on expectations for a similar pause today on Wall Street as traders await key US jobs data tomorrow.
Around 12.30pm, the UK benchmark index was around 3 points lower at 7,186, while US blue chip index futures indicated a flat start in New York after yesterday’s uneventful minutes from last month’s Federal Reserve policy meeting, published yesterday.
Chris Beauchamp, chief market analyst at IG, said: “After the Fed minutes last night the focus shifts to the outlook for US jobs, with the ADP payroll and initial jobless claims figures on the ticket for the day, ahead of NFPs tomorrow.”
He added that “a bumper set of job figures in the next two days are needed to restore the bullish momentum.”
A batch of negative broker comment weighed in London, with engine maker Rolls-Royce Group PLC (LON:RR.) a big FTSE 100 faller, down 4%, or 27p at 640.5p after JP MorganCazenove cut its target price on the stock to 730p from 890p.
The US broker warned that Rolls-Royce’s earnings would be "highly depressed" over the next several years.
JPMorgan also blighted shares in RSA Insurance PLC (LON:RSA), which shed 1.4%,, or 8p to 568p as the broker cut its stance to ‘neutral’ from ‘overweight’.
But on the second line, biotech firm BTG PLC (LON:BTG) took on nearly 4%, or 22.5p at 618.0p after Panmure Gordon repeated its ‘buy’ rating on the stock with a new price target of 737p.
10.15 am …Constructive gains …
The Footsie ticked higher as the morning session progressed, supported by strong gains from housebuilders, although retailers remained on the naughty step.
Around 10.15am, the FTSE 100 index was up almost 8 points at 7,197, continuing the fairly subdued performance this week having reached a new record high above the 7,200 level on the first session of 2017.
Traders were cautious as they digested meeting minutes yesterday from the US Federal Reserve as well awaited the minutes from the last European Central Bank meeting, due out at midday, and crucial US payrolls data due tomorrow.
James Hughes, chief market analyst at Gkfx.com, said: “Yesterday’s Fed meeting minutes were a bit of a non-event as the Fed gave us all what we had expected.
“Despite this it was still a particularly hawkish stance with members maintaining that we are looking at 3 rate hikes in the US in 2017.”
The run of upbeat UK December purchasing managers indexes continued today, with activity in the services sector reaching a 17-month peak last month, although price pressures remain high, giving a boost to hopes for 2016 UK economic growth.
On currency markets, sterling eased off earlier lows after the PMI data but stayed weak, down 0.2% versus the dollar at US$1.2297.
Housebuilders provided the main support for the FTSE 100, with Persimmon PLC (LON:PSN) a strong gainer, up 5.5% to 100p as it said it sold more homes at higher prices in 2016, with the second half seeing strong customer demand continuing.
Sector peers Taylor Wimpey PLC (LON:TW.), ahead 3.6% at 167.3p, and Barratt Developments PLC (LON:BDEV), up 2.9% at 497.8p were among those also benefiting from the good news.
Broker comment was a boost for blue chip outsourcing group G4S (LON:GFS), which gained over 4% at 239.9p after Jefferies International upped its rating to ‘hold’ from ‘underperform’.
But clothing retailer Next Plc (LON: NXT) was impacted by a deluge of negative broker comment, including downgrades in rating from Credit Suisse and Societe Generale, after yesterday’s profit warning and poor Christmas sales news.
Next shares topped the blue chip fallers list once again, down another 14% at 4,093p, while peer Marks & Spencer PLC (LON:MKS) dropped another 4.5% at 328.9p, and mid-cap department stores operator Debenhams PLC (LON:DEB) topped the FTSE 250 fallers list, off almost 6% at 51.8p.
07.00am ... Firm start seen ...
London’s FTSE 100 is currently expected to start Thursday on the front foot, but only just.
Having started the New Year strongly, pushing to new highs, there’s now some pause for thought amid continuing uncertainties in the macroeconomic environment.
Attentions are pointed towards the US where tomorrow brings the closely followed non-farm payroll employment report, which will guide sentiment as markets anticipate upcoming interest rate decisions from the US Federal Reserve.
“Last nights Fed minutes reinforced US policymaker expectations that we could well see multiple rate rises this year after last month’s rate rise, though officials remained cautious given the lack of clarity on the type of fiscal expansion that might be forthcoming in the coming months,” said Michael Hewson, analyst at CMC Markets.
On Wednesday in New York the Dow Jones index closed 60 points, 0.3%, higher at 19,942 whilst the S&P 500 added 0.57% to end the session at 2,270. The Nasdaq, meanwhile, finished Wednesday’s trading up 0.88% at 5,477.
In Asia, Hong Kong’s Hang Seng this morning rose 1.47% to 22,462 while Japan’s Nikkei dipped 0.37% lower to 19,520. The Shanghai Composite was in positive territory, rising 0.25% to 3,166.
Here in London the FTSE 100 is seen slightly higher just over an hour before the open with CFD and spreadbetting firm IG Market calling the benchmark at 7,184 to 7,188.
Markets (around 10.30am)
Gold is up 1.0% to US$1,175 an ounce
Brent crude down 0.1% to US$56.40 a barrel
UK pound is worth US$1.2307
City Headlines
Bosses at now-collapsed Swan Hellenic cruises firm All Leisure Group paid themselves almost £1mln in 2015 – Daily Telegraph
Three top investment bankers at a boutique in St James’s, London have shared almost £37mln after advising on a string of the biggest takeover deals of recent years – The Times
Currency trading broker FxPro has shelved plans for a stock market flotation as financial spread-betters brace for a clampdown – Daily Mail
A former Barclays currency trader has become the first individual to plead guilty to a criminal charge in a major US investigation into foreign exchange rigging – The Times
Donald Trump’s pick for U.S. secretary of state, Rex Tillerson, will get a US$180mln (£147mln) cash payout from oil giant ExxonMobil, if he gets the job – The Independent
A man has replaced Baroness Ford as the Chairman of Grainger PLC (LON:GRI), breaking up the first all-female board of a FTSE company – The Independent
Deutsche Bank’s head of financial crime and anti-money laundering is stepping down just six months after he was hired to help improve systems and controls – Financial Times
Alibaba is suing two vendors who sold fake Swarovski watches on its ecommerce platform, in what it claims is the first such legal action in China – Financial Times