FTSE 100 finishes lower
Wall Street surges
Bitcoin volatility continues
Pound strength remains
FTSE 100 finished lower on Thursday, the last trading day of November, as the pound strengthened and despite Wall Street rallying.
The UK blue-chip benchmark closed the afternoon session down over 66 points at 7,326.
The FTSE 250 also plunged, shedding over 106 points, to finish at 19,952.
Against the Euro, the pound added 0.24% while against the US dollar, it gained 0.54%. On Wall Street, the Dow Jones is up 1.14% at the time of writing.
"The FTSE 100 has been at the mercy of the pound today and even though the market managed to swing to positive territory earlier today, it was dragged back into the red as sterling pickled up," said David Madden, at CMC Markets.
In Germany, the Dax is down around 37 points despite being higher earlier in the day as investors were optimistic about a potential political deal between the Christian Democratic Union (CDU) and the Social Democratic Party (SDP).
In companies, the biggest gainer on Footsie was international hospitals group Mediclinic (LON:MDC), which added 4.72% to 565.50p.
The group was boosted by an upgrade to ‘buy’ from ‘underperform’ by analysts at the American bank Jefferies.
The biggest loser was AstraZeneca (LON:AZN), the drugs titan, down 2.51% to 4,777p.
2:45pm: FTSE 100 backs off, Wall Street benchmarks make mixed start
The FTSE 100 backed off in afternoon trade, down 20 points or 0.27% to 7,374.
On Wall Street, equity benchmarks were mixed.
The Dow Jones advanced 120 points or 0.5% changing hands at 24,061, while the Nasdaq rose 0.3% to 6,848. The S&P 500, meanwhile, edged slightly lower to 2,626.
US equities were supported by employment statistics.
Dennis de Jong, managing director at trading firm UFX, in a note, said: “Donald Trump will take heart from the slight fall in claimants, particularly after early blows in his first term to various employment-driving infrastructure projects.
“With the holiday season upon us, an optimistic outlook, and one that the President will almost certainly peddle, is that the latest figures are indicative of a resilient jobs market heading in the right direction, which is the mainstay of healthy economic growth.”
12:45pm: Crude prices rise ahead of OPEC meeting
The oil market is predicting that today’s OPEC meeting in Vienna will go as expected, with the producer’s cartel extending its price supporting cap on output.
Market expectations ahead of the cartel get-together are for OPEC to extend the current arrangement by a further nine months, taking the cap through to the end of 2018.
It comes amid comments from Saudi Arabia energy minister Khalid al-Falih who is in favour of the proposed extension.
In London crude trading, Brent futures were up 1.6% at 64.16 a barrel, while the US crude contract was 90 cents a barrel higher at around US$57.80.
12:15pm: FTSE 100 draws level by midday, while US futures point higher
The FTSE 100 was all but flat by midday, with the blue-chip benchmark changing hands at 7,393.
Wall Street futures, meanwhile, pointed higher ahead of the open in New York.
The Dow Jones was indicated up 80 points at 23,998 while the S&P 500 and Nasdaq are also seen higher.
12:00pm: FOMO a key driver in Bitcoin’s extreme volatility
Bitcoin has been making headlines all week, with the cryptocurrency blasting above US$11,000 on Wednesday, and it is expected to remain volatile for some time – indeed, by Thursday, the price dropped back to around US$9,700.
The fear of missing out (or FOMO) is apparently behind at least some of the rampant speculation.
“Whilst traditional assets are experiencing historically low levels of volatility, the whipsaw action of the bitcoin is drawing the attention of traditional traders. Meanwhile existing traders and new comers are increasingly interested in fear of missing out,” CFD group City Index said in note.
“Bubble or no bubble, there is nothing to say the price can’t go up further.
“With more interest from professionals, from the mainstream, and Nasdaq also announcing plans to launch bitcoin futures, the virtual currency’s legitimacy has grown exponentially which is reflected in its price increase.”
10:30am: Pound strength continues as deal-makers get closer to clearing hurdles
The British pound continued higher on Thursday as reports suggest Brexit deal makers may clear one of the immediate hurdles to the main event market negotiations.
“Sterling remains well bid as Britain seems to be nudging closer to a positive outcome for the Brexit negotiations,” said Neil Wilson, senior analyst at ETX Capital.
“Reports in The Times suggesting Britain and the EU are close to agreeing terms on the Irish border has fuelled the latest round of buying.
“This would be a major breakthrough on one of the three main barriers to the EU approving the start of discussions on a transition deal and negotiations on Britain's future relationship with the EU. With sterling the barometer, it seems markets are starting to price in a lower chance of a hard Brexit.”
Whilst the pound strengthens, London’s international earners see more selling pressure on the exchange.
Elsewhere, today’s OPEC meeting is in focus for oil investors – with expectations that the producer’s cartel will extend its output reduction.
Royal Dutch Shell Plc (LON:RDSB) and BP Plc (LON:BP) were both lower, down 0.46% and 0.1% respectively.
10:00am: FTSE 100 narrows earlier losses, down 16 points
The FTSE 100 narrowed the morning’s earlier losses, trading 16 points or 0.22% lower at 7,380.
Two of London’s big pub stocks moved in opposite directions in Thursday’s early deals, with Marstons Plc (LON:MARS) rising almost 9%, to 114.14p, whereas Greene King Plc (LON:GNK) recovered with its opening lows but was still down 3% by around 9:30am.
Marstons, meanwhile, reported an 8% increase in revenue, a 24% rise in pre-tax profit and earnings per share gained 12%.
Greene King said the first half was “challenging” with industry-wide cost pressures and poor weather dragging profits and revenues lower
A deal to revise BAE Systems Plc’s (LON:BA) UK pension arrangements sent the aerospace engineer’s shares 2.2% higher to 556p.
Aviva Plc (LON:AV) shares added 2% to 519.50p, as the insurance group upgraded its growth outlook as well as its cash and dividend forecasts.
Property group Grainger Plc (LON:GRI) was off 1.3% priced at 281.8p, despite financial results showing better profits and rental income.
Lamprell Plc (LON:LAM) slumped 9% to 63.5p after the offshore services contractor issued a profit warning due to teething problems in its offshore wind venture.
8:45am: FTSE 100 starts on back foot amid Brexit concerns; BAE tops the risers after pension deal
The FTSE 100 opened on the back foot as the pound strengthened against the dollar amid continued chatter about the massive bill for Brexit, hitting a clutch of transatlantic earners.
The index of blue-chip shares nudged down 23 points to 7,370.94.
Trading in the oilers was subdued ahead of meeting in Vienna of the OPEC oil cartel, which should prolong production cuts until the end of the next year.
The day’s big riser was the defence contractor BAE Systems (LON:BA.), which has addressed concerns over its long-term pension arrangements by agreeing to increase contributions to the retirement pot. The end to the uncertainty led to a 3.2% rise in the stock.
Also on the up was the international hospitals group Mediclinic (LON:MDC). It was the beneficiary of an upgrade to ‘buy’ from ‘underperform’ by analysts at the American bank Jefferies. There shares advanced 2.2% on the back of the call.
Moving down a division to the FTSE 250 one of the big casualties was tour operator Thomas Cook (LON:TCG), which was downgraded to ‘sell’ by the German outfit Berenberg. The shares slid 2.7%.
Proactive news headlines:
Bushveld Minerals Ltd (LON:BMN) is to take control of the Vametco vanadium project in South Africa through the buy-out of partner Yellow Dragon. Shareholders will need to approve a reverse takeover that will see Bushveld will pay US$11.1mln in cash and shares for Yellow Dragon’s 55% of their BVL joint venture.
The numbers are really starting to add up for ITM Power (LON:ITM), the energy storage and clean fuel company, which has seen its deal pipeline increase £5.9mln in the two months since raising £29.4mln from investors. The business now has £20.2mln of projects under contract and a further £22.4mln of deals in the final stages of negotiation.
Gold explorer-cum-digital currency group Lionsgold Limited (LON:LION) has raised to £550,000 to help fund its various activities going forward.
MySQUAR Limited (LON:MYSQ) saw revenues jump to US$1.06mln last year in what was a busy period for the Myanmar-language social media, entertainment and payments platform.
Kibo Mining PLC (LON:KIBO) is to acquire a power station development in Botswana to leverage the knowledge acquired from its Mbeya project in Tanzania.
Vast Resources PLC (LON:VAST) has released the final batch of drill results from its recent programme at the Manaila polymetallic mine in Romania, where is it is studying a potential location for a second open pit.
Technologica, Seeing Machines Limited’s (LON:SEE) exclusive partner in the Middle East, has won two major deals for the London-listed company’s Guardian driver fatigue monitoring technology, representing the company's largest single fleet customer deals to date.
Construction of forestry management company Active Energy Group PLC’s (LON:AEG) first five-tonne-per-hour CoalSwitch biomass fuel plant in Utah will be completed next month. Full commissioning and revenue generation will follow thereafter, with the plant providing sufficient CoalSwitch fuel to satisfy existing early-stage demand in Utah and for commercial (paid for) burn testing at full-scale power utility plants
The financial year just ended was a record one for platinum group metals (PGM) producer Tharisa PLC (LON:THS) in terms of production and profitability.
Cadence Minerals Plc (LON:KDNC, OTC:KDNCY) said it had completed the due diligence process on two early-stage lithium assets in which it plans to invest. It hopes to have tied up binding agreements by the year-end with the aim of beginning the exploration process in earnest in the first quarter of next year.
Sound Energy PLC (LON:SOU) has unveiled a new estimate of the Sidi Moktar exploration project onshore Morocco. The explorer told investors it sees potential for up to 11.2 trillion cubic feet of gas within a portfolio of targets – consultant Echo Geoscience Management Ltd (EG) has detailed 28 leads in a variety of play types.
Tower Resources PLC (LON:TRP) has hired contractor DMT Petrologic for a 3D seismic data reprocessing programme at the Thali licence offshore Cameroon. DMT was selected in a tender of six potential contractors. The process will cover some 500 square kilometres worth of data, spanning the entirety of the Thali licence plus the surrounding areas.
Harvest Minerals Limited (LON:HMI) has welcomed news that the Upper House of the National Congress of Brazil has approved a bill to reduce the royalty rates of fertiliser projects from 3.0% to 0.2% which it sees significantly benefitting the group.
6.45am: Back foot start for the Footsie
London’s blue-chip equities are seen starting Thursday on the back foot, with macro matters again on the agenda today.
Here, market chatter continues to roll around Brexit – so far this week the talk has been on US$50bn settlement agreement, the Irish border, and the rights of resident EU citizens. Uncertainty prevails.
In the United State it has been about Trump - his tax plans, his tweets – as well as the latest North Korea ballistics testing.
Globally, attentions are on the OPEC meeting in Vienna later today, where the expectations are for an extension to the crude output arrangements which have supported stronger oil prices in recent months.
Equity markets have been mixed. In New York, Wall Street benchmarks were moving in different directions.
Whilst the Dow Jones gained 103 points or 0.44%, to 23,940, on Wednesday both the S&P 500 and the Nasdaq moved lower, 0.03% and 1.27% respectively, as it emerged that Trump’s new tax system may not be so good for the major technology groups.
In Asia, Japan’s Nikkei climbed 127 points or 0.57% to 22,724. But, Hong Kong’s Hang Seng dropped 450 points, 1.5%, to trade at 29,169 and the Shanghai Composite was 0.67% lower at 3,315.
Australia’s ASX 200 was off 0.69% trading at 5,969.
In London, CFD and spreadbetting firm IG Markets is expected a softer start for the FTSE 100 – calling the blue-chip benchmark down 26 points, at 7,366 to 7,370 just over an hour before Thursday’s open.
Significant announcements expected:
Trading update: Go-Ahead Group PLC (LON:GOG)
Interims: Greene King PLC (LON:GNK), Paypoint PLC (LON:PAY), Torotrak plc (LON:TRK)
Finals: Daily Mail & General Trust PLC (LON:DMGT), Grainger PLC (LON:GRI), Marston’s plc (LON:MARS), On the Beach Group PLC (LON:OTB), Premier Asset Management PLC (LON:PAM)
Economic data: US weekly jobless claims; US personal income, consumption; Chicago PMI
Ex-dividends: To knock 1.3 points off FTSE 100 index (International Consolidated Airlines Group PLC (LON:IAG), Johnson Matthey PLC (LON:JMAT), Land Securities PLC (LON:LAND, Severn Trent PLC (LON:SVT)
Around the markets:
Sterling: US$1.3453 up 0.33%
Gold: US$1.283 an ounce up 0.13%
Brent crude: US$63.46 up 0.55%
Headlines
UK consumer sentiment sinks to 16-month low, business mixed - Reuters
EU rule capping bankers' bonuses 'could be scrapped after Brexit' - The Guardian
Iceland and Co-op back deposit return scheme on plastic bottles - Sky News
Kellogg's to cut sugar in kids' cereals by up to 40% - BBC News
Network Rail and train operators shunted towards closer integration - Financial Times
American Air Accidentally Gave Too Many Pilots Christmas Off - Bloomberg