UK lenders are in the red after Bank of England Governor Mark Carney said interest rates should remain on hold amid worries about Brexit and weak wage growth.
Shares in Barclays plc (LON:BARC) fell 1.265 to 204.15p, Lloyds Banking Group plc declined 2.05% to 67.29p (LON:LLOY) and Royal Bank of Scotland Group plc (LON:RBS) dipped 0.44% as record low interest rates carve into their profits.
Banks are engaged in a mortgage price war by offering customers cheap borrowing rates.
Carney said at Mansion House in London today that he wants to see how Brexit negotiations play out before considering hiking rates, sending the pound to its weakest level against the dollar since mid-April.
Barclays was also dragged lower by news that the Serious Fraud Office launched criminal charges against the bank for offences related to a £7.3bn emergency cash injection from Qatar in 2008 which staved off a UK government bail-out.
A weakened pound gave stocks with international earnings a boost, including Unilever plc (LON:ULVR), Burberry Group (LON:ULVR) and WPP (LON:ULVR).
2.29pm: Energy stocks slump as oil prices fall
Energy stocks are among the biggest fallers on the FTSE 100 in afternoon trading after oil prices plummeted.
BHP Billiton plc (LON:BLT) shares fell 2.59% to 1,149.50p, Royal Dutch Shell (LON:RSDA) slid 1.55% to 2,097.50p and BP plc (LON:BP. slipped 1.61% to 465.05p.
Oil prices tanked with Brent crude falling 2.3% to US$45.83 per barrel and West Texas Intermediate declining 2.4% to US$43.49 per barrel on signs of rising production from Libya and Nigeria.
Libya's oil output rose more than 50,000 barrels per day to 885,000 barrels per day (bdp), while exports of Nigeria's benchmark Bonny Light crude oil are set to rise by 62,000 bpd in August, Reuters reported.
Copper prices also retreated, down 1.02% to US$257.95 per pound on the Comex, sending mining shares lower. Antofagasta plc (LON:ANTO) dropped 2.65% to 771.50p and Anglo American declined 1.24% to 973.80p.
Rio Tinto plc’s (LON:RIO) shares also headed south after rejecting a counter bid from Glencore for its Australian coal mines.
Shares in Rio fell 1.52% 5o 3,041.0p and Glencore plunged 2.38% to 281.10p.
Rio is sticking with its initial buyer, Chinese-backed Yancoal, saying that it had already achieved clearance from regulators so the deal would be completed sooner than if it were to wait for Glencore to get the green light.
Glencore offered US$2.55bn for the assets, $100mlnmore than the initial bid by Yancoal, which was announced in January.
11.22am: Fusionex under pressure as broker quits
Fusionex International plc (LON:FXI) shares are under pressure after the ‘big data’ analytics specialist said its nomad and broker, Stifel Nicolaus Europe, has resigned.
The company’s shares will be suspended once Stifel’s resignation takes effect from 5pm
This means shareholders who haven’t sold their stake before Fusionex is taken private next Tuesday will only have a matter of hours to trade their shares.
Fusionex drew criticism from investor Standard Life after the company unexpectedly announced its plans to de-list from AIM at the end of May.
Standard Life said: “It feels like the company has been taken from us without our consent.”
The group’s broker, Peel Hunt, and PR adviser, Buchanan, both resigned in protest at what The Telegraph described as a “backdoor attempt by [Fusionex’s] founder to seize control”.
Shares fell 9.60% to 56.50p in late morning trading.
Tullow Oil’s shares dipped 3.41% to 152.50p after saying its chief financial officer Ian Springett is stepping down due to ill-health.
The company has appointed interim chief finance officer Les Wood to replace Springett on a permanent basis, effective immediately.
Amur Minerals Corporation (LON:AMC) shares edged up 4.03% to 61.9p as it provided an update on the current drill programme in Russia’s Far East.
Drilling is targeting the Kun Manie project’s Ikenskoe / Sobolevsky (IKEN) and Kubuk (KUB) deposits, and since beginning the programme in early May the company has so far completed some 5,903 metres of drilling, about 30% of the planned programme.
Morses Club Plc (LON:MCL) rallied after chief executive Paul Smith said the lender had made an encouraging start to the year.
"Trading performance over the period is encouraging and is in line with the board's expectations,” Smith said at the group’s annual general meeting. “Our net loan book and customer numbers have continued to increase and impairments remain within our guidance range reflecting our focus on higher quality lending. Territory builds have contributed to our loan book growth and continue to represent an attractive opportunity for us.”
09:20am: N Brown a top riser first quarter results
N Brown Group plc’s (LON:BWNG) shares gained after the fashion retailer reported a 5.6% increase in first quarter revenue, driven by online sales.
Online sales grew 16% year-on-year and now account for almost three-quarters of total revenues. Of this online traffic, more than half (51%) came from customers using smartphones.
The company delivered a particularly strong performance in its ladieswear brands, including Simply Be and JD Williams.
While the internet-based offering is growing, N Brown and its labels are struggling on the high street.
The group said today it is closing down five of its Simply Be and Jacamo dual-fascia stores largely due to “weak high street footfall” both current and predicted.
N Brown expects to take a one-off hit of between £10mln and £14mln in relation to the closures, which should be completed by the end of August.
The company said it is still on track to meet full-year guidance, although it expects a rise in exceptional costs due to the store closures.
Shares rose 11.94% to 318.75p in early trading.
RWS Holdings plc (LON:RWS) was also on the front foot after posting an increase in half year profits and sales.
The intellectual property provider, which specialises in patent translations reported a 39.6% increase in adjusted pre-tax profit to £19.4mln as sales jumped 35% to £76.6mln.
More than 90% of group revenue was derived from its intellectual property and life sciences services.
The company said it had an “encouraging” early contribution from its language translation business LUZ Inc., which it bought in February. Results were also bolstered by its Corporate Translations Inc. subsidiary, growth in patent translation services and a material improvement in gross margins.
Shares increased 4.38% to 405.0p in morning trading.
Going the other way, Wolseley PLC (LON:WOS) slumped after a mixed trading update from the plumbing and heating products firm.
Shares dropped 2.25% in early trading.
In a trading update for the three months ended April 30, the FTSE 100-listed group reported good sales performances in the US residential and commercial markets, countered by weak growth in the UK.
Wolseley, which will change its name to Ferguson PLC at the end of July to better reflect the weight of its US operations, said its like-for-like revenue grew by 6.6% to £4.27bn.
The Plumb Center owner added that exchange rate movements increased revenue by £423mln, with growth at constant rates reduced to 4.6%.
In the US, Wolseley reported like-for-like revenue growth of 8.5%, a third-straight quarterly improvement, but in the UK like-for-like revenues were 0.4% lower year-on-year impacted by rising inflation.
Wolseley noted that ‘repairs, maintenance and improvement markets remained weak’ in Britain.
Assura plc (LON:AGR) was also under the cosh after announcing plans for a fundraise to support its acquisition and development pipeline.
The company, which builds surgery buildings and primary care centres in the UK, said it will place up to 164mln new ordinary shares or around 9.9% of its existing issued share capital. The placing is expected to be in the range of 58p to 60p per share.
Proceeds of the placing will be used to fund its £153mln pipeline of acquisition and development opportunities.
Shares dropped 3.94% to 61.0p in morning trading.
8.00am: Proactive news headlines...
Aminex plc (LON:AEX) has told investors it has now repaid its corporate loan facility in full. The company now describes itself as a ‘debt-free’ gas producer. It also highlighted that its operating subsidiary in Tanzania, Ndovu Resources, continues to be paid in dollars for gas sales from the Kiliwani North project although there have been some delays.
Shanta Gold Ltd (LON:SHG) has unveiled a series of transactions that should utterly transform the Tanzania-focused miner. It is acquiring Vancouver-based Helio Resource Corp for US$5.6mln; it is raising US$14mln from investors, and it has agreed a debt restructuring deal that significantly reduces the coupon on those borrowings.
88 Energy Ltd (LON:88E) has confirmed that the second stage of fracking in the Icewine-2 appraisal well has been completed successfully. Two zones of the HRZ shale have now been fracture stimulated, the company highlighted, with more than 98% of the intended proppant volume injected into the reservoir.
Tlou Energy Limited (LON:TLOU) has achieved ‘first power’ from its coal bed methane (CBM) project in Botswana, where the Lesedi gas field is hooked into generators. The company describes it as a ‘significant milestone’ which is evidence of the group’s ability to deliver power from, and therefore further monetise, the CBM gas resource.
Sula Iron & Gold PLC (LON:SULA) has completed the first hole of a new 5,000m drill programme at the Sanama Hill target at Ferensola in Sierra Leone. The first hole FDD025, is being logged with two further holes on Sanama Hill close to completion (FDD026 & FDD027). In due course one of the two drill rigs will be transferred to TZ4, the Southern Target, to commence a targeted programme there.
Solo Oil PLC (LON:SOLO) boss Neil Ritson has highlighted that efforts continue to at least sell part of its stake in the Ntorya gas project, onshore Tanzania, where partner Aminex plc is presently advance development plans. Aminex, in a separate statement on Tuesday, noted that it is working with the Tanzanian Petroleum Development Corporation (TPDC) on a two-stage development plan for Ntorya.
A pick-up in production from its new San Gregorio West underground mine in the last three months enabled Orosur Mining Inc (LON:OMI TSX:OMI) to meet production guidance for a fourth year in a row. Total gold produced for the year to March was 35,371 oz (compared to guidance of guidance of 35-40,000) with a third of that (10,748oz) in the final quarter as SGW ramped up.
Shares in Kin Group Plc (LON:KIN) edged higher on Tuesday Morning after the digital wellness provider revealed it had won a new contract with an NHS Trust hospital. The one year deal will see Kin, which trades as Kin Wellness, provide a services programme for the hospital’s doctors, nurses and staff.
Ariana Resources plc (LON:AAU) is raising £2 mln in new money via a placing and subscription of shares at 1.3p a share. The initial raise of £1.87 mln has already been completed with the help of ubiquitous mining broker Beaufort and by Panmure Gordon.
Amur Minerals Corporation (LON:AMC) has provided an update on the current drill programme in Russia’s Far East, where it is working to expand the metal deposits of the Kun-Manie project. Drilling is targeting Kun Manie’s Ikenskoe / Sobolevsky (IKEN) and Kubuk (KUB) deposits, and since beginning the programme in early May the company has so far completed some 5,903 metres of drilling, about 30% of the planned programme.
Ormonde Mining plc (LON:ORM)’s revised construction schedule for the Barruecopardo tungsten project in Spain now calls for plant commissioning to begin in the third quarter of 2018. This follows the rescheduling of certain construction contracts such that they now run consecutively instead of concurrently, and also follows on from the completion of the necessary land acquisitions.
Horizonte Minerals Plc (LON:HZM TSX:HZM) has awarded another batch of contracts for the feasibiity study at its Araguaia nickel poreject in Brazil with some of the workstreams now more than 50% finished. Contracts have now been awarded for the transports and logistics to Steinweg Handelsveem, for power lines and transmission to SM&A Electrics and to VCE Mine Consultancy for the legal permit report.