FTSE 100 closes 41 higher at 7,507
Sterling falls as concerns grow over Theresa May's position
FTSE 250 up 59 at 20,088
FTSE 100 closed over 40 points higher as sterling slides with Merlin Entertainments plc (LON:MERL) the biggest gainer.
It shares added 3.43% to 463.80p on talk of a possible deal with Florida-based SeaWorld - the marine park specialist.
Merlin, which owns Alton Towers and Legoland, is understood to be interested in only part of the US business.
FTSE 100 closed at 7,507, boosted by a weaker pound, which was down 0.40% against the Euro at the time of writing, and down 0.84% against the US dollar.
In the US, shares are again hitting record highs ahead of tomorrow's closely watched non-farm payrolls (NFP) report figure.
The ADP employment change reading - always a precursor to the main event - came in at 135,000 - the lowest reading since October 2016 due to hurricanes Harvey and Irma.
The market consensus is for a read tomorrow of a weak 80,000 jobs added for the month.
The biggest laggard on Footsie on the day was insurer Aviva PLC (LON:AV), whose shares shed 0.05% to stand at 490.26p.
3.30pm - Sterling at four-week low
Sterling has fallen to four-week low against the dollar, giving a slight lift to the FTSE 100.
An invisible force field, however, appears to be preventing the Footsie from attaining the 7,500 level; it got as high as 7,499 before ebbing to 7,492, up 25 points.
That force field may disappear tomorrow when the keenly anticipated September jobs report – or non-farm payrolls (NFP) report, to give it its formal name - comes out in the US.
“The September NFP report, scheduled for release on Friday 6th October at 1330 BST, is a tricky one to predict due to the disruption caused by the hurricanes in Florida and Texas last month. The market is looking for an extremely weak 80k, which factors in the effect of the hurricanes. We believe that consensus is too pessimistic, and our model is looking for a healthier reading of 171k,” said Kathleen Brooks at City Index.
News flow among FTSE 350 stocks has been thin on the ground.
A downgrade from ‘add’ to ‘hold’ by Peel Hunt did a little damage to the share price of newsagent WH Smith Plc (LON:SWMH) – down 1.2% to 2,054p – but the broker stuck with its 1,850p price target.
Buses and trains group Stagecoach Group PLC (LON:SGC) trundled forward, advancing 0.3% to 169.6p after Liberum Capital cranked up its price target from 155p to 170p.
2.45pm: Mining stocks drive Footsie's advance
The top-shares index continued to bat its eyelashes at the 7,500 level without going through with the advance.
With US markets having opened at new highs, the Footsie pushed on to 7,495, up 28 points on the day.
Mining stocks were going well, with Antofagasta PLC, Anglo American PLC and Glencore PLC all showing gains of more than 2%.
At the smaller end of the sector, lead-zinc exploration company Ferrum Crescent Limited (LON:FCR, ASX:FCR) cheered the market by withdrawing plans to raise fresh capital.
The board believes that it is possible its pursue a strategy to build value at the Toral lead zinc asset for a cost lower than originally planned, hence the decision not to issue new shares just yet.
The stock shot up 42.6% to 0.0549p on the news.
1.30pm: FTSE 100 gets small lift from prospect of a firm opening on Wall Street
US stocks were expected to open a tad firmer, giving the FTSE 100 a small extra lift.
The FTSE 100 was up 28 at 7,495 an hour ahead of the start of trading in the US.
The Dow Jones average was seen opening its account at 22,668, up 6 points, while the broader-based S&P 500 was expected to climb a couple of points to 2,540.
Theme parks operator Merlin Entertainments PLC (LON:MERL) wrestled with gold miner Anglo American (LON:AAL) to be the top performer on the Footsie leader-board.
The former was up 2.9% at 461.5p while the latter was also up 2.9%, at 1,471.5p.
11.45am: The Footsie spins its wheels
After a bright start, the Footsie traded sideways for most of the morning.
Sterling’s decline provided a boost to the Footsie’s many big dollar earners but conversely, concerns about developments in Catalonia weighed on sentiment.
The FTSE 100 was up 13 at 7,480.
Among the small caps, mine development companies were getting the usual punishment after raising fresh capital.
Bezant Resources PLC (LON:BZT) has raised £700,000 of new capital through the issue of new shares, with the cash injection earmarked for working capital.
The shares were issued at 1.1p each, versus last night’s closing mid-market price of 1.40p; the stock currently trades at 1.125p.
W Resources PLC (LON:WRS) raised £1mln to support the company during the ongoing construction phase of the La Parrilla mine development in Portugal.
The shares were issued at 0.375p, prompting market makers to reduce the stock’s mid-market price to 0.39p from 0.41p overnight.
10.30am: The Footsie heads confidently towards 7,500 - before losing its nerve
After getting close enough to take a peek at the 7,500 level, the Footsie developed vertigo and surrendered some of its gains.
The FTSE 100 was up 12 at 7,480, having risen as high as 7,494 at one point.
Ex-dividend stocks Aviva PLC (LON:AV.), Next PLC (LON:NXT), WPP PLC (LON:WPP) and Kingfisher PLC (LON:KGF) also took some of the gloss off the Footsie, but on the plus side SSE PLC (LON:SSE), up 2.1%, and Tesco PLC (LON:TSCO), up 2.3%, recovered some of yesterday’s losses.
Passenger statistics for September from low-cost airline easyJet PLC (LON:EZJ) were, in terms of share price impact, rather like the aircraft of its rival Ryanair, neither here nor there.
The load factor rose to 93.6% from 91.1% in the same month of last year, prompting the shares to edge a penny higher to 1,278p.
Results from small-cap DFS Furniture PLC (LON:DFS) disappointed, with the retailer blaming “very challenging” markets for a fall in underlying earnings.
The shares were on offer at around 215.25p, down 4.3%.
Among the tiddlers, Bezant Resources PLC (LON:BEZ) fell out of bed, shedding 0.275p at 1.125p, after unveiling a share issue at 1.1p a share.
The placing will raise around £700,000 for the gold and platinum mines developer.
8.45am: The Footsie opened firmer despite geopolitical concerns
The FTSE 100 made modest gains against the political uncertainty created by the events in Catalonia and the ‘omnishambles’ that was Prime Minister Theresa May’s speech at the Tory Party conference.
The index of blue-chip shares opened proceedings around 18 points higher at 7,485.98.
The investment banking side of HSBC had the utilities in its cross-hairs Thursday – though it appears to be upbeat on their prospects.
SSE (LON:SSE) was up 1.4% early on as HSBC’s analyst repeated their ‘buy’ advice, although they tempered their price target slightly.
Proving it is often better to travel than arrive, shares in Morses Club (LON:MCL) succumbed to profit-taking after the release of results earlier, having added almost a quarter in the wake of the collapse of larger rival Provident Financial (LON:PFG).
“As Morses notes, it has been able to capitalise on ‘changing market conditions’,” said Neil Wilson of ETX Capital.
“This is an understatement - Provvy’s botched reorganisation was an open goal for Morses Club. We’ll see next Friday if Provident is doing anything to turn things around.”
Sticking with the small-caps (but one that’s growing every day), Proactive notes that Peel Hunt has initiated coverage of Motif Bio (LON:MTFB), which on Wednesday revealed that successful conclusion of the second of two Phase III clinical trials.
The broker reckons Motif’s shares are worth 106p – more than double the current price.
Proactive news headlines:
Caledonia Mining Corporation PLC (LON:CMCL) has announced record quarterly gold production from the Blanket Mine in Zimbabwe for the quarter ended September 30, 2017. In a statement, the AIM-listed firm said approximately 14,389 ounces of gold were produced during the quarter, 15% higher than the previous quarter and 7% higher than the corresponding quarter of 2016.
Ortac Resources Ltd (LON:OTC) has announced that Casa Mining Ltd - in which it holds an effective 45% stake - has reported “extremely encouraging” results from the first two diamond core drill hole assays taken from the Akyanga gold deposit in the Democratic Republic of the Congo. AIM-listed Premier African Minerals Ltd (LON:PREM) also owns a 4.5% stake in Casa Mining.
Amphion PLC (LON:AMP), which has a 14.1% stake in Motif Bio PLC (LON:MTFB, NASDAQ:MTFB), believes Motif is still not fully valued, even after its shares soared from 36.75p to 44.5p yesterday after its lead drug sailed through a critical Phase III trial.
Glycotest, a portfolio company of NetScientific PLC (LON:NSCI) has had a Japanese patent granted to it over a biomarker for early-stage liver cancer.
ANGLE PLC (LON:AGL,OTCQX:ANPCY) is to acquire some assets from a Canadian company with intellectual property that complements ANGLE’s Parsortix liquid biopsy platform for £3.7mln. It is also proposing to raise £12.2mln through the issue of shares at 35p a pop.
Annual results from SkinBioTherapeutics PLC (LON:SBTX) chart a period of significant progress, including April’s listing on AIM (which brought in £4.5mln) and the demonstration of the three modes of action of its platform, SkinBiotix. It is developing the technology as a cosmetic, a hand cream that protects against hospital-acquired infections and a treatment for eczema.
Avacta Group PLC (LON:AVCT) is teaming up with a company from Finland called FIT Biotech to develop a technology that helps the body create its drugs. To do this, scientists somehow need to deliver the DNA blueprint that encodes the protein, or gene into the patient's cells.
Faron Pharmaceuticals Oy (LON:FARN) is raising £10mln from a small pool of institutional investors – cash that will be used to fund an early access programme for its lead drug, Traumakine. Shares are being issued at 800p each, which is a modest 2% discount to Wednesday’s closing price. The company will receive £9.4mln once the costs of the fundraise are deducted.
Highlands Natural Resources PLC (LON:HNR) has extended the timeline for its East Denver Niobrara shale project in Colorado. The end date has moved to December 2020 from 2018; the timeline from drilling to completion of each well extends from 180 to 270 days while the gap between the drilling of wells is now 180 days from 90.
Rose Petroleum PLC (LON:ROSE) confirmed it is advancing its 3D seismic exploration campaign in the Paradox basin, Utah. The company highlighted that field operations started shortly after its recent funding, and it is now “well on track” with the seismic shoot and it anticipates completion ahead of the company’s own schedule, targeting the year-end..
Sound Energy PLC (LON:SOU) has struck a deal to sell its entire Italian portfolio of assets, allowing it to focus on core assets in Morocco. The deal is, however, structured as a share based transaction that’s more akin to a ‘spin-out’ rather than a cash boosting exchange.
SDX Energy Inc. (LON:SDX, CVE:SDX) has announced a new oil discovery in Egypt, with the Rabul-2 well unearthing heavy crude in the West Gharib concession. Rabul-2 hit some 101.5 feet of net oil pay across the Yusr and Bakr formations, and the company expects the well will be completed as a new producer connected to processing facilities at the Meseda field.
Bezant Resources PLC (LON:BZT) has raised £700,000 of new capital through the issue of new shares, with the cash injection earmarked for working capital. The junior mining group said the capital will provide support as it moves towards the start of production from higher-grade gravels at the Choco project, in Colombia.
6.45am: Modest gain predicted
London’s FTSE 100 is expected to start Thursday’s trading session lower, but only slightly.
Investment sentiment continues to be weighed down by political uncertainties, namely the turmoil in Spain where the Catalonia region is reportedly on the cusp of declaring independence – a move that would further escalate tensions with Madrid.
“The continuing deadlock hasn’t done the Spanish stock market any favours, as it posted its biggest one day fall in fifteen months and fell below the 10,000 level for the first time since March this year, while Spanish and Catalan borrowing costs surged as investors sold Spanish and Catalan government debt,” said Michael Hewson, analyst at CMC Markets.
“For now tensions remain high as both sides look to the next move. It is expected that some form of declaration might be made next week when the Catalan parliament is due to sit to discuss recent events.
“That is always assuming they are allowed to and the Spanish government doesn’t implement article 155 of the Spanish constitution and prevent the sitting from taking place, and impose direct rule from Madrid. It almost feels like that is what the Catalan President is hoping the government will do exactly that, which in turn is likely to ratchet up the tension further.”
Meanwhile, in the United States thoughts are on the economy and rates.
Wall Street closed Wednesday higher, setting more record highs, with equities boosted by positive economic stats (September ISM services) which were more impressive given they came despite the impacts of last month’s hurricanes.
The Dow Jones added around 20 points or 0.09% to close at 22,661, while the S&P and Nasdaq rose 0.12% and 0.04% to finish at 2,537 and 6,534 respectively.
In Asia, Japan’s Nikkei was very slightly lower changing hands at 20,617. Hong Kong’s Hang Seng, meanwhile, climbed 0.73% to 28,379 and the Shanghai Composite added 0.28% to 3,348.
Australia’s ASX 200 was down just a sliver at 5,651.
In London, spreadbetting and CFD firm IG Markets sees the FTSE 100 taking a very small lead, calling the blue-chip benchmark at 7,466 to 7,470 about an hour before Thursday’s open.
Headlines
BoE supervisor urges EU regulators to work together on Brexit - Financial Times
Wave of rail strikes to hit services across England again today – Telegraph
Facebook brings British profits onshore after tax rule change – Reuters
Trump Interior Department will delay methane emissions rules for oil and gas - CNBC
A big bond move could be around the corner - CNBC
Thursday’s agenda
Interim results
Pacific Assets Trust PLC (LON:LAC), Morses Club PLC (LON:MCL), Ferrexpo PLC (LON:FXPO)
Final results
SkinBioTherapeutics PLC (LON:SBTX), DFS Furniture PLC (LON:DFS)
Trading Statements
Merlin Entertainments PLC (LON:MERL), Ferrexpo PLC (LON:FXPO)
AGM / EGMs
Henderson Smaller Companies Investment Trust PLC (LON:HSL), Artemis Alpha Trust PLC (LON:ATS)