FTSE 100 closes at new high - 7,787.97
FTSE 250 also up
But US stocks weak on tech earnings drag
Oil price reaches near US$80 per barrel
Ocado shares soar as it inks Kroger deal
FTSE 100, the UK index of leading shares, closed at a new record high, as oil firmed and online retailer Ocado (LON:OCDO) surged.
The blue chip index finished Thursday at 7,787.97, up 0.70% , or over 53 points after also today reaching a new intra-day high of 7,792.60
The previous all-time closing peak was 7,778.64 on January 12 this year.
Also higher was FTSE 250 which added over 190 points, or 0.925 to 21,019.
Brent crude added 1.08% to stand at US$79.28 a barrel.
Fiona Cincotta, Senior Market Analyst at City Index, noted: "As Brent hits the psychological level of $80 per barrel traders are questioning whether oil to $100 is a possibility?
"Fundamentally the price looks well supported here, OPEC are showing they are in no rush to end production cuts, Venezuela’s oil industry is collapsing under its economic and political crisis and US sanctions aimed at Iran’s oil industry are kicking in.."
The biggest riser of the day in London was Ocado Group PLC (LON:OCDO), with shares jumping 43% to 789.41p as it inked its fifth major partnership deal as it teamed up with the American giant Kroger Co (NYSE:KR).
Top riser on Footsie was Experian (LON: EXPN), which gained 5.59% to 1,804.50p.
FTSE 100 on course for new high
The FTSE 100 looks on course to close at a new high, surpassing the 7,778.64 peak it hit on January 12.
It is currently trading at 7,786.20, which is just below the all-time intra-day high of 7,792.60 hit the same day.
2.50pm: FTSE 100 gains continues; US stocks open lower
The Footsie held firm in late afternoon trading bolstered by strong energy shares as oil prices reached US$80 a barrel even though US stocks dropped back weighed by disappointing earnings from tech giant Cisco Systems.
At around 2.50pm, the FTSE 100 index was 34 points higher at 7,767, just off the day's peak of 7,771.24 and close to mid-January's all-time closing peak of 7,778.64.
But in early trading on Wall Street the Dow Jones Industrial Average was down 78 points to 24,692, while the S&P 500 dropped 3 points to 2,720 and Nasdaq composite fell 13 points to 7,389 as tech stocks retreated.
On the data front, the US Labour Department reported that new applications for unemployment benefits increased 11,000 to a seasonally adjusted 222,000 for the week ended 12 May. Economists polled by Reuters had forecast claims rising to 215,009 in the latest week, CNBC reports.
2.15pm: Trump's trade tariffs present risk to global dividends in 2018
US President Donald Trump’s trade tariffs present one of the biggest risks to global dividends in 2018, according to investment manager Martin Currie.
Trump in March imposed worldwide tariffs of 25% on US imports of steel and 10% on aluminium.
Martin Currie’s Global Equity Income manager Mark Whitehead said such barriers is a risk to the outlook for dividends.
The total value of global dividends rose 7.7% to US$1.25trn in 2017 and the growth rate in 2018 is forecast to remain unchanged.
“It is a serious risk if the situation becomes even more strained, and for those companies with high levels of foreign sales it could have a significant impact,” he said.
1.30pm: Ocado shares soar
The biggest riser of the day was Ocado Group PLC (LON:OCDO), with shares jumping 61.4% to 891.0p as the UK online grocer signed its fifth major partnership deal as it teamed up with the American giant Kroger Co (NYSE:KR).
“Ocado is making great strides in the global grocery market and inflicting serious financial pain on those who have bet against it,” said Laith Khalaf, Senior analyst at Hargreaves Lansdown.
“It’s probably no coincidence that a number of deals have been flushed out since Amazon announced a takeover of Whole Foods last summer. The threat of a big disruptor entering the sector puts pressure on food retailers to be on top of their game when it comes to online deliveries, and that’s where Ocado comes into its own, “ he said.
12.30pm: FTSE 100 climbs, US set to open lower
The FTSE 100 index rose 11 points to 7,745 at midday, moving closer to a new record high.
“The FTSE 100 is gaining ground today, bouncing off seven-week rising support, keeping the uptrend alive,” said Artjon Hatsaturjants, research analyst at Accendo Markets.
“Drivers include rising oil flirting with $80/barrel, in spite of stronger USD, and corresponding GBP weakness. Geopolitical jitters (US-China trade talks, Italian coalition negotiations, NK summit) are failing to faze investors who have grown a thicker skin in light of the events of last few years,” he said.
After closing at 24,768 yesterday, the Dow Jones Industrial Average is expected to open 35 points lower today.
“The Dow hasn’t had much luck in clawing back Tuesday’s trade war-fearing losses, with little on the horizon in the rest of the week – beyond an unforeseen update on the state of play between the US and China – to spark a recovery,“ said Connor Campbell, financial analyst at Spreadex.
11.30am: Oil price reaches higher
Oil prices have climbed above US$80 a barrel on Thursday.
The strong demand and tightening supplies took the oil price to the highest in almost four years.
10.50am: Fevertree outlook less sparkling
For the first time since joining AIM, Fevertree Drinks PLC (LON:FEVR) has failed to upgrade its outlook for the year in a trading statement.
In an update ahead of its annual general meeting later today, the posh tonic maker said it is “trading in-line with market expectations”.
“The market has become rather accustomed to Fevertree beating expectations and upgrading guidance (January’s was the sixth in the year), so when results are just moderately ahead, things look a little flat,” said Neil Wilson, senior market analyst at Markets.com.
“We note very strong results today of course but the outlook for 2018 seems a less sparkling than we are used to, with management simply saying it is ‘encouraging’, which explains why we’re seeing a bout of profit-taking in early trade.”
10.00am: FTSE 100 could be heading for a new record high
After a shaky start, the FTSE 100 rose 1.8 points to 7,736.11 at around 10am. Analysts at AJ Bell think today might be the day that the FTSE 100 could achieve a new record high at the market close.
“It is up 12 points to 7,746 on Thursday and only needs another 33 points to smash the all-time high achieved in January,” says Russ Mould, investment director at AJ Bell.
Earlier this morning the government confirmed it will cut the maximum wager for fixed odds betting terminal (FOBT) to £2 from £100, with shares in bookmakers dipping on the news.
“The change will impact profits at the big high street bookmakers, but the US Supreme Court’s decision to open up the sports betting market over the pond means shares in the sector are still likely to end the week higher,” said George Salomon, equity analyst at Hargreaves Lansdown.
He added: “The potential in the US is enormous. Around $150bn is already wagered on the underground market every year, and this will surely rise as barriers to betting are removed. For the UK bookies, the chance to tap into this huge potential could mean lost machine revenues are more than replaced.”
“What’s likely to follow is something of a land grab. First out of the blocks is Paddy Power Betfair, which is already in discussions about a new US partnership,” Salomon concluded.
8.50am: Bloodshed for the bookies
The FTSE 100 shrugged off the political uncertainty caused by the latest Italian election to trade 10 points higher at 7,744.63 early on.
But it was bloodshed for the bookies as it was confirmed the government will cut the maximum wager for fixed odds betting terminals to just £2, effectively stymying a significant source of revenues.
The impact on share prices, which had already been primed for the crackdown, was still marked with 888 Holdings (LON:888) sliding 9%, William Hill (LON:WMH) off 7% and GVC (LON:GVC) losing 6% of its value.
Among the top-line stocks Royal Mail (LON:RMG) was the biggest casualty after the release of its prelims led to a bout of profit-taking with stock having advanced around 50% in the last six months.
And there are some "pitfalls ahead", according Richard Hunter at Interactive Investor. "In terms of these results, UK productivity was below target, transition costs were significant and this move towards a leaner and more technologically focussed operation will become more pressing," he added.
"In the meantime, competition shows no sign of abating, where Deutsche Post – let alone the seemingly ubiquitous Amazon – are menacing foes."
Finally, Vodafone (LON:VOD) slid on a downgrade by the London arm of the US broker Citi.
Proactive news headlines:
Active Energy Group PLC (LON:AEG) is to acquire a controlling interest in PowerWood Canada Corp, a privately owned Canadian forestry company. PowerWood holds substantial forestry assets in Alberta, Canada, under forestry management agreements, and deciduous cutting rights issued by the Crown Province of Alberta.
Esports group Gfinity Plc (LON:GFIN) has appointed heavy-hitting sports executive Garry Cook as its new executive chairman.
Financial results for the first quarter confirmed SDX Energy Inc (LON:SDX, CVE:SDX) is benefitting from its operational successes in Egypt and Morocco. The months were punctuated by exploration and appraisal achievements, which add to the group’s growing production profile.
Hurricane Energy PLC (LON:HUR) returned with another Lancaster field project update, telling investors that the newly-fabricated buoy for the early production system has now departed dry dock in Dubai.
Tekcapital PLC (LON:TEK) has announced that its portfolio company Belluscura PLC has completed a further tranche in the private placement to raise an additional US$603,000 through the issue of equity. Big Pic in February.
Namibia-based tantalum miner Kazera Global PLC (LON:KZG) is to undertake a drilling programme across its whole licence to gauge the potential in its entirety. Kazera holds a 75% stake in African Tantalum (Aftan), which operates the Namibian Tantalite Investment Mine (NTI).
Tlou Energy Limited (LON:TLOU) (ASX:TLOU), the company focused on delivering power in Botswana and southern Africa through the development of coal bed methane, has released a new corporate presentation, which is available from the company's website https://tlouenergy.com/presentations
ReNeuron Group Plc (LON:RENE), a UK-based global leader in the development of cell-based therapeutics, said, as previously announced, it is hosting a capital markets event today focused on the company's exosome nanomedicine platform. The group said it will not be providing any new material information.
Metminco Limited (ASX & AIM: MNC) advises that its latest presentation has been released to the Australian Securities Exchange and is available on the company's website.
Taptica (LON:TAP), the global end-to-end mobile advertising platform for advertising agencies and brands, announces the publication of a Q&A manuscript from chief executive officer, Hagai Tal, on the company's website.
W Resources PLC (LON:WRES), the tungsten, copper and gold, exploration and development company with assets in Spain and Portugal, announced that its latest corporate presentation is now available on the group’s website.
6.45am: Footsie expected to edge lower
London’s FTSE 100 is seen slightly lower ahead of Thursday’s open against a mixed backdrop in the global equities market.
IG Markets sees the UK benchmark opening just 1 point lower at 7,734 to 7,738 with about an hour and half to go before the open.
Wall Street benchmarks made a positive finish to Wednesday’s session. The Dow Jones added 62 points or 0.25% to close at 24,768.
The S&P 500 ended trading up 11 points or 0.41% at 2,722, whereas the Nasdaq moved 46 points or 0.63% higher to 7,398.
Asia’s indices were mixed. Japan’s Nikkei climbed 145 points or 0.64%, while Hong Kong’s Hang Seng was on the back foot, down 0.07% at 31,086, and the Shanghai Composite was off 0.33% at 3,159.
In Europe, attentions are on Italy where fresh a spark of Euro uncertainty has reignited.
“Italian yields hit their highest levels this year on the back of concerns that a new Italian coalition government could upend the status quo in Italian politics with measures like a call for €250bn of debt forgiveness on Italian debt, as well as the prospect of a roadmap to euro exit,” said Michael Hewson, analyst at CMC Markets.
He added: “While the anti-establishment parties of Five Star and Lega insisted that the text of the coalition agreement was an old one, the fact that the €250bn amount was there in print, had the effect of reawakening concerns about their commitment to the euro project.”
“This really shouldn’t come as a surprise given that both sides haven’t been particularly shy in the past about admitting their desire to upend the status quo and have new discussions about how to move forwards in a manner that harks back to a pre-Maastricht treaty status quo.”
In terms of corporate news, attention will be Royal Mail Group Plc (LON:RMG) and Thomas Cook Plc (LON:TCG) as both have updates pencilled into the diary.
Significant events expected on Thursday May 17:
Finals: Royal Mail Group PLC (LON:RMG), British Land PLC (LON:BLND), Experian PLC (LON:EXPN), National Grid PLC (LON:NG.), Mothercare plc (LON:MTC), 3i Group PLC (LON:III), Sophos Group PLC (LON:SOPH), Wincanton PLC (LON:WIN)
Interims: Thomas Cook PLC (LON:TCG), Countryside Properties PLC (LON:CSP), Euromoney Institutional Investor PLC (LON:ERM), Future PLC (LON:FUTR), Grainger PLC (LON:GRI)
Trading updates: Hill & Smith Holdings PLC (LON:HILS), Just Group PLC (LON:JUST), Regional REIT Limited (LON:RGL)
Ex-dividends: To knock 6.8 points off FTSE 100 index - HSBC PLC (LON:HSBA), Intertek Group PLC (LON:ITRK), Tesco PLC (LON:TSCO)
Economic data: US weekly jobless claims; US Philly Fed business outlook
Around the markets:
- Pound: US$1.3542, up 0.42%
- Gold: US$1,291, up 0.14%
- Brent crude: US$79.36 a barrel, up 1.17%
- Bitcoin: US$8,350, up 0.12%
City Headlines:
- ‘Crack cocaine' gambling machines maximum stakes set to be cut - Sky News
- Mothercare to bring fired boss Newton-Jones back in to steer restructuring – Telegraph
- NHS doctors bemoan pain of working with outsourcer Capita - Financial Times
- WeChat's owner Tencent sees profits soar by more than 60% - BBC News
- Dealmaker Martin Gilbert puts board post at Glencore on hold to focus on Sky takeover battle - This is Money
- Deliveroo employees are getting shares, riders are getting nothing - TechCrunch
- Total to drop billion-dollar Iranian gas project unless US waives sanctions - Telegraph
- Federal investigators are looking into Tesla's latest autopilot crash in Utah - Washington Post
- Senate Votes to Reinstate Obama-Era Net Neutrality Rules - Wall Street Journal
- Bumble Bee CEO indicted for tuna price-fixing scheme - CNNMoney
- Ford to resume F-150, Super Duty production – MarketWatch
- Southwest hopes $49 fares will draw customers after its first passenger death - Washington Post