FTSE 100 closes down 30 at 7,337
Deutsche Bank ups price target for BHP by £2 while HSBC abandons bearish stance on Shire
Open season on Lloyd's insurance companies as sterling weakness makes them look cheap
Britain's blue chips closed down over 30 points on Thursday as US shares plunged.
The FTSE 100 closed the day at 7,3337, down 0.41%, while the FTSE 250 was down over 80 points bat 19,369.
The Dow Jones on Wall Street, at the time of writing, is down over 87 at 21,390.
On Footsie, fashion retailer Next Plc (LON:NXT) was the biggest lower, down over 3% to $3,785p as it began trading in ex-dividend form.
The top gainer was Associated British Foods plc (LON:ABF), which added 2.57% to stand at 2,997p. The Primark owner reported an improved performance in the third quarter, with particularly strong trading at the fashion retail arm that slightly lifted full year expectations.
Bank shares also did well. Barclays (LON:BARC) added 2.42% to 209.15p, while RBS (LON:RBS) gained 1.64% to 259.9p.
4pm - FTSE regains some pose...
Approaching the close, the FTSE 100 had regained some of its poise and was down 32 at 7,336, despite fairly heavy falls in the US.
According to David Madden at CMC Markets, investors are getting mixed signals from central bankers.
"Last night the Federal Reserve revealed the minutes from the June meeting, and policy makers are divided over further interest rate hikes and the timing of when to begin reducing the balance sheet. This division is adding to the uncertainty in the markets as traders can’t predict the Fed’s next move. Adding to that, the European Central Bank considered leaving out the promise to keep buying government bonds, and that contemplation alone, has spooked investors," he noted.
1.00pm ... Stocks slide further in expectation of weak US opening
The US benchmark, the S&P 500, is tipped to open sharply lower, down 12 at 2,420, which has accelerated selling in London.
At just gone 1.00pm, the FTSE 100 was down 53 at 7,314, barely 10 points above its low point for the day.
In percentage terms, the FTSE 250, down 131 points (0.7%), was performing as badly as its bigger brother.
Mid-cap underwriting firm Lancashire Holdings Limited (LON:LRE) defied the trend and was the best performing FTSE 250 constituent, up 4.8%, as sector peer Novae Group PLC (LON:NVA) succumbed to a takeover offer from AXIS Capital Holdings Limited.
The all-cash offer from AXIS values the Lloyd’s operator at 700p a pop. Novae shares advanced to 706p, having closed last night at 581.5p.
Among the small caps, Powerhouse Energy Group PLC (LON:PHE) shot up 5.9% to 0.90p after executive chairman Keith Allaun took questions from shareholders live on air in the Proactive Investors studio.
10.30 ... FTSE 100 makes up its mind to retreat (towards the TV and coverage of Wimbledon)
After an uncertain start, the FTSE 100 kicked lower at about 10.30am.
The FTSE 100 was down 31 at 7,337 approaching 11.00am, with fashion retailer Next Plc (LON:NXT), down 2.7%, the worst performer, trading in ex-dividend form.
Also hitting the index was Worldpay Group PLC (LON:WPG), the payments processing firm.
The shares eased 2.6% to 362.2p, giving back some of the handsome gains seen in the last week after Vantiv came in with what was seen as a lowball indicative offer of 385p.
Reckitt Benckiser Group PLC (LON:RB.) was still in the dog-house, down 1.9%, after the Dettol and Cillit Bang owner admitted it would need to apply a bit of disinfectant to its information technology systems after last month’s Cyber-attack.
Reckitt Benckiser warns of permanent sales hit from cyber attack https://t.co/QmY6dCIS4g
— BBC Business (@BBCBusiness) July 6, 2017
Going the other way was mining heavyweight BHP Billiton plc (LON:BLT), which climbed 13p to 1,247.5p after Deutsche Bank said the shares were worth 1,600p, having previously placed a value of 1,400p on them.
Drugs giant Shire Plc (LON:SHP) also received a lift from broker comment, rising 32p to 4,365p after HSBC moved from ‘reduce’ to ‘hold’.
8.58 ... FTSE 100 opens with a Cillit whimper
The FTSE 100 was barely changed in early trading, despite a sparkling performance by Primark owner Associated British Foods plc (LON:ABF).
AB Foods was the top riser on the FTSE 100, up 5% at 3,065p, helping limit the top-share index’s fall to six points at 7,362.
READ AB Foods shares jump as underlying trading ahead of forecasts thanks to strong profit performance from Primark
Primark boosts profits for Associated British Foods https://t.co/V0mLU5aR8K pic.twitter.com/xPTnoLRKoa
— Shop-Equip (@shopequip) July 6, 2017
The shares rose after the group said revenue in the third quarter of its financial year was 10% on a year earlier. Perhaps more pertinently, in terms of explaining the share price rise, the group said its outlook for the financial year as a whole had marginally improved.
Floundering at the other end of the Footsie tree was household goods giant Reckitt Benckiser Group PLC (LON:RB.) after its trading update underwhelmed.
Dettol maker Reckitt Benckiser warns revenue will be hit as it cleans up Petya cyber attack https://t.co/9A6ZfbdbWw pic.twitter.com/q1kcy36tbv
— Telegraph Business (@telebusiness) July 6, 2017
The shares were down 2.2% at 7,530p after it cut its full year revenue forecast as some of its factories are yet to return to operation following a cyber-attack last month.
Proactive news headlines…
Gfinity Plc (LON:GFIN) is looking forward to the start of its flagship event, the Elite Series, which kicks off tomorrow.
The season of eSports competition begins at the Gfinity eSports Arena in London on Friday July 7, and events will run every weekend through to September 3. The competition will be broadcast online, at Gfinitiyesports.com.
Allergy Therapeutics (LON:AGY) has published data in peer-reviewed journals from two preclinical studies analysing its immuno-therapy platform as a potential vaccine against malaria and the flu.
A recent study at Berkeley Energia Limited’s (LON:BKY) Salamanca uranium mine in Spain has found that the total upfront capex (capital expenditure) required is less than initially forecast. According to the front-end engineering and design (FEED) study, final upfront direct costs for the project are €74.7mln; 1% below estimates released in last summer’s definitive feasibility study.
Chaarat Gold Holdings Ltd (LON:CGH) has strengthened its management team at its Tulkubash gold project in the Kyrgyrz Republic, which remains on schedule. Frank Fenne, a mining veteran with over thirty years experience in global projects including major mine builds in Nevada and Australia has been recruited as head of geology, while Davron Vakhabov, a heap leach pad specialist, joins from Lydian, the developer of the Amulsar project in Armenia.
Motif Bio Plc (LON:MTFB) has a busy week lined up in early October, when it will be presenting at the annual Infectious Diseases conference. Three abstracts have been accepted for poster presentations at the Infectious Diseases Week Annual Meeting in San Diego 4-8 October 2017.
MySQUAR Limited (LON:MYSQ) has announced the launch of Mingalarbar Morning a new news aggregation app for its customers in Myanmar. The app is designed to address a lack of comprehensive local language news.
Preview: Slow start expected
London’s FTSE 100 is expected to open slightly higher on Thursday, though US interest rates and summertime distractions are in play.
The release of June’s Federal Reserve meeting minutes had Wednesday’s post-Independence Day equity markets subdued. It suggested members of the Fed policy committee are concerned about loose monetary policy – specifically, that keeping rates too low, too long will lead to sharp spikes in growth and that would trigger fast rate tightening.
“The US central bank would like to press ahead with increasing interest rates in predictable and timely increments even though inflation is relatively low,” said David Madden, analyst at CMC Markets.
“The Fed feels that in the medium term inflation will pick up and move towards their 2% target. Some policy makers, did express concerns about raising interest rates will while inflation is weak.”
Madden added: “The Fed believes that equity markets are strong because of a higher risk appetite by investors, it is a convenient way of not talking about how the low interest rate environment is driving asset prices.”
Wall Street closed out Wednesday in mixed but undramatic fashion. The Dow Jones was essentially flat for the session, lowering by just 1 point to 21,478.
The S&P 500 edged slightly, just 3 points, higher to 2,432. Meanwhile, the Nasdaq rose by 40 points, 0.67%, to finish the trading session at 6,150.
Asia saw more movement, with key benchmarks lit in red. Japan’s Nikkei was down around 0.4% just above 20,000 whereas Hong Kong’s Hang Seng was down slightly, 0.6%, at 25,507. The Shanghai Composite was down 0.23% at 3,200.
In Australia, the ASX 200 was moving higher, but not by much, trading up 3 points at 5,766.
Here in London, the FTSE 100 is expected to get off on the front foot.
CFD and spreadbetting firm IG Markets sees the FTSE 100 about 10 points higher, calling the benchmark at 7,369 to 7,373 just over an hour before the start of Thursday’s trading.
Ex-dividend factors will clip 1.33 points from the FTSE 100 index on Thursday, with luxury goods firm Burberry PLC (LON:BRBY) and high street clothing retailer Next Plc (LON:NXT) the only two blue chip firms trading without entitlement to their latest payouts.
Headlines
Volvo shakes up car market in pursuit of electric dream - Financial Times
Mike Ashley's talk of £15m deal was just banter, court is told - The Guardian
Mike Ashley brands himself 'fat as a barrell' during £15m High Court - Evening Standard
Britain's finance industry faces 'tipping point' over Brexit – Reuters
Onthemarket wins competition case in battle with Zoopla and Rightmove - City A.M.
BA cabin crew to stage new 14-day strike - BBC News