FTSE 100 dragged down by South Africa-focused stocks
Feedback a winner for the second day in a row
Direct Line boosted by JPM
Bid approach to Hayward Tyler
Stock market bulls were drawing comfort from the fact the FTSE 100 rose 180 points in the first quarter, as the market wilted on Friday.
The top-share index closed 47 points lower at 7,323, with South African insurance company Old Mutual PLC (LON:OML) the biggest faller as the South African rand took a tumble following the sacking of Pravin Gordhan, South Africa's well-regarded finance minister.
Aim-listed medical imaging software company Feedback plc (LON:FDBK) was the best performing stock, rising for the second day in succession after it signed a letter of intent with an unnamed global imaging company that wants to make Feedback's TexRAD Lung product available on its platform.
Today's rise, at 62.5% (to 3.25p) was even more impressive than yesterday's rise from 1.37p to 2p.
Full-year results gave a lift to North Midland Construction PLC (LON:NMD).
The shares rose 28% to 262.5p as the provider of civil engineering services saw earnings per share double to 25.95p in 2016 from 12.32p in 2015.
15.30 ... FTSE mired as US calvary fails to arrive
A weak start on Wall Street scuppered any change FTSE 100 would rally heading into the weekend.
London’s blue chip index was 30 points lower at 7,340 as miners took a hit along with other overseas earners.
The two property giant Land Securities (LON:LAND) and British Land (LON:BLND) topped the risers with gains of around 2.5% to 1,052p and 609p respectively.
Among the small caps, Engineer North Midland Construction plc (LON:NMD) rose 29% to 264p on the back of a solid set of full-years.
Despite only posting a modest increase in revenues, operating profits almost trebled to £2.2mln although the company refused to praise itself, saying that it wants more.
The firm was pretty bullish in its outlook too, claiming that the UK construction industry was “struggling to keep up with…demand”, which should bode well for the coming year.
US preview
It's end-quarter, and although it has been a good three months for US markets it looks like ending on a dull note.
Spread betting quotes point to the benchmark S&P 500 opening around three points lower at 2,365, giving up roughly half of yesterday's gains.
The Dow Jones was seen shedding around 26 points to open at 20,702.
There was no encouragement to be drawn from the morning sessions in European markets, where the trend was also gently weaker.
FMC Corp (NYSE:FMC) was set to be a bright spot after it agreed to acquire a chunk of the crop protection business of E I Du Pont De Nemours And Co (NYSE:DD).
The latter was up 0.6% at US$82.11 in pre-market trading, as it pocketed US$1.2bn in cash and took ownership of FMC Health and Nutrition in return for divesting crop protection assets.
The sale of the crop protection interests was a pre-requisite for the European Commission's approval of DuPont's merger with The Dow Chemical Company (NYSE:DOW).
FMC's shares were a hot property in pre-market trading ,rising 13% to US$69.50.
Fallen smartphone giant BlackBerry Ltd (NASDAQ:BBRY, TSE:BB) advanced 6.3% in pre-market trading after it said to be profitable on an adjusted basis in 2018.
Canada's tech champion posted a quarterly loss of US$47mln, equivalent to 10 cents a share. That represented an improvement on a year earlier when it posted a loss of US$238mln, or 45 cents a share.
Stripping out one-off items, the company's earnings per share this time round were positive at four cents; analysts who follow the stock had expected earnings per share to be on or around zero.
11.30am ... FTSE 100 down 40 points
FTSE 100 has struggled since the Article 50 sign-off and it was the case again today as investors refused to commit.
Footsie was down 40 at 7,329 after a few hours trading.
The Easter holiday is fast approaching, but with two weeks to go it seemed a stretch that traders would be packing up this early.
Direct Line Group PLC (LON:DLG) was the best performer after a JPMorgan Cazenove upgrade following the changes to no-win no-fee rules.
The US bank upgraded its stance on Direct Line to ‘overweight’ from ‘neutral’, albeit with a reduced target price of 395p, down from 410p.
BT Group PLC (LON:BT.A) was in the regulatory cross hairs again as Ofcom proposed a cap on wholesale superfast broadband prices.
The proposals – assuming they go ahead as planned – would cut the price BT’s infrastructure arm, Openreach, can charge competitors for its superfast service, which has speeds of up to 40 megabits per second. Shares were flat at 317.2p.
Hayward Tyler PLC (LON:HAYT) shot up 35% to 50p as confirmed early stage takeover discussions with Avingtrans PLC (LON:AVG).
8.45am..FTSE 100 has a case of the Brexit blues; housing market softens
The FTSE 100 suffered a case of the Brexit blues as it promised to end the quarter with a whimper.
Ignoring the slightly more positive mood in the US, the index of blue-chip shares lost 20 points early on to trade at 7,349.80 ahead of the latest GDP revisions.
UK house price growth softened this month, according to the Nationwide, with annual growth slowing to a full percentage point to 3.5%, its worst performance since August 2015. The month-on-month figure actually went into reverse as it fell 0.3%.
An upgrade by JP Morgan to ‘overweight’ propelled insurer Direct Line (LON:DLG) 3.5% higher and to the top of the FTSE 100 risers’ list.
The miners were on offer early on along with some of the financial stocks.
Among the tiddlers, Oxford Pharmascience Group plc (LON: OXP) slumped as the US Food and Drug Administration knocked back trial plans for its re-formulated version of ibuprofen.
The firm, which boasts star fund Woodford Investments as a major backer, said the FDA disagreed with the endpoints for a phase III study.
The FDA wants claims of improved gastro-intestinal (GI) safety to be backed up by the trial and for there to be an improvement in peptic ulcer bleeding and related complications.
Alternatively, the FDA has suggested the claim for the drugs are toned down, which would not need such a detailed clinical study.
Oxford said it would consider the FDA suggestions carefully before a decision is made on the development programme.
Shares fell by a third to 2.02p.
Proactive news headlines
Eland Oil & Gas (LON:ELA) has given details of its success production restart at the Opuama field in Nigeria, where new crude shipping arrangement have unlocked new opportunities. Shares rose 5% to 48.2p.
Mining group Ortac Resources Ltd (LON:OTC) has further increased its holding in DRC-focused gold explorer Casa Mining and now holds 22.80% of the private firm.
Eco Atlantic Oil & Gas (LON:ECO) highlighted Exxon's latest neighbouring oil discovery, marking its third find in the block adjacent to the junior explorer's.
Digital media and social video broadcaster Brave Bison Group plc (LON:BBSN) slashed its losses last year as revenues jumped and its cost-cutting strategy kicked in. Shares rose 2% to 1.15p.
Akers Biosciences Inc (LON:AKR) has announced a US$2mln fundraising to prop up its balance sheet. The group will issue 1,448,400 common shares at US$1.40 per share. Shares fell 17% to 145p.
Drug developer MaxCyte PLC (LON:MXCT) has unveiled ambitious plans to raise £20mln, which will be used to accelerate the development of its immuno-oncology platform, CARMA.
Lithium explorer European Metals Holdings Ltd (LON:EMH) has confirmed the pre-feasibility study for its Cinovec deposit in the Czech Republic will be published in April.
Nigeria-focused LEKOIL (LON:LEK) has agreed a US$15mln advanced payment facility with a local offshoot of Royal Dutch Shell for production from the Otakikpo field. Shares rose 4% to 22.8p.
6.45am ... Dull start to final session of March ...
The Footsie is expected to start lower this morning, the last day of the month and the first quarter following a mixed performance today by Asian markets, despite gains overnight in New York.
Spread betting firm CMC Markets expects the FTSE100 index to open about 23 points lower at 7,346, having shed 4.2 points yesterday, although that was off session lows as US markets advanced early on.
All three major Wall Street indexes closed about 0.3% higher overnight and the dollar rose after fourth-quarter annualised US GDP growth was revised up from the previously reported figure, with consumer spending growth also higher.
Asian shares were mixed today, however, as the dollar extended its gains overnight on the signs of strong US economic growth, and as investors balanced positions on the last day of the month and quarter.
Michael Hewson, chief market analyst at CMC Markets UK, said: “As first quarters go it’s been a solid start to the year for 2017, all the more surprising given the fact that we’ve seen two US rate rises in the space of three months, and put aside concerns about the first few months of a Trump presidency and the European banking system, against a backdrop of simmering political risk in Europe.”
It is also the end of a momentous week that saw the Brexit process finally triggered by prime minister Theresa May, and the final reading for UK fourth-quarter 2016 economic growth, to be revealed this morning, will draw a line under the year the shock vote was taken.
The second reading for growth in the three months to December 2016, delivered last month, was revised up to 0.7% from an initial 0.6% reported in January, but full year GDP for 2016 was revised down to 1.8% from 2.0% on the back of weaker exports.
Meanwhile, mortgage lender Nationwide is expected to unveil its latest house price index on Friday as well, with IHS Markit forecasting a modest 0.3% month-on-month increase in March after rises of 0.6% in February and 0.2% in January.
There will be little on the corporate news front to provide much other interest despite it being the latest day of March, and with the end of tax year just around the corner.
Among the few results scheduled, veterinary services firm CVS Group PLC (LON:CVS) should report a strong first-half, with underlying earnings (EBITDA) seen rising to around 19mln, up from £15.2mln a year earlier.
Full-year results from life and pensions company Chesnara Plc (LON:CSN) will also be of interest, particularly following its £136mln acquisition of Legal & General Group PLC’s (LON:LGEN) Dutch life and pensions arm last year.
Significant events expected Friday March 31:
Interims: CVS Group PLC (LON:CVS), Touchstone Innovations Plc (LON:IVO), Mobile Streams Plc (LON:MOS), Management Resources Solutions PLC (LON:MRS), Pantheon Resources Plc (LON:PANR)
Finals: Chesnara Plc (LON:CSN)
Around the markets:
- Sterling: US$1.2483, up 0.1%
- Gold: US$1,242 an ounce, down 0.2%
- Brent crude: US$50.16 a barrel, down 0.4%
City Headlines:
- London Stock Exchange chief to make £5mln from failed Deutsche Boerse deal – The Times
- DFS may make more sofas in Britain to fight falling pound – The Times
- Top BlackRock investor says he hasn’t given up hope on the pound – The Independent
- Beijing considers merger to create US$230bn energy group, say reports – Financial Times
- VW agrees to pay additional US$157mln to settle environmental claims – Financial Times
- Oxford University’s Spybiotech raises £4 million in seed funding to tackle pandemics – Daily Telegraph
- Self-driving cars could lend ‘£8bn boost to U.K. economy’ – Daily Telegraph
- We must reinvent great British department store, says new John Lewis Boss Paula Nickolds – Daily Mail
- Poundland takes on Asda with low-cost clothing range – The Guardian