FTSE 100 closes higher - just
7digital Group rises after deal with Triller
US benchmarks up but European stocks lag
FTSE 100 closed in positive territory Friday, but only just, as other European benchmarks lagged amid renewed fears on Turkey.
The UK's blue-chip benchmark added around two points to close at 7,558. On the week as a whole, it was down 1.4%.
The mid-cap FTSE 250 shed nearly 18 to stand at 20,444.
"The European session got off to a cautiously optimistic start following on from the mixed session in Asia overnight," said David Madden, analyst at CMC Markets.
"Trade talks between the US and China will resume next week, and dealers are hopeful, but we will have to wait and see. The heightened tensions between the US and Turkey caused the Turkish lira to take a leg lower, and this reignited fears that the European banking system could be shaken by either defaults or non-performing loans from Turkey."
Among the big Footsie risers was Primark owner Associated British Foods (LON:ABF), which added 1.34% to stand at 2,338p, while steelmaker Evraz (LON:EVR) added 1.15% to 466.60p.
Antofagasta (LON:ANTO) was the biggest loser, dropping 1.97% to 827p.
This week the copper titan warned that rising trade tensions were causing market uncertainty.
3.45pm: FTSE 100 finds few reasons to be cheerful
The Footsie was languishing near its low for the day, ending a drab week for the index.
The FTSE 100 was down 40 points at 7,517, having started the week at 7,667, raising the prospect of the Footsie notching up its worst week in months.
The FTSE 250 fared a little better, falling 79 (0.38%) to 20,383.
On the foreign exchange markets, sterling was regaining ground against the greenback, rising 0.19 of a cent to US$1.2731.
2.00pm: FTSE 100 slumbers on; US indices tipped to open lower
With Wall Street set to open lower, UK equities have been disinclined to rally in the afternoon session.
The FTSE 100 was down 36 at 7,520, about half an hour before the US open. Spread betting quotes point to the Dow Jones kicking off about 25 points lower at 25,532 and the S&P 500 starting at about 2,838.3, down a couple of points.
“Global trade worries have not disappeared, they are just on hiatus, as market participants prefer to regroup and strategise in this unorthodox US trade and foreign policy environment,” declared Dean Popplewell of forex trading platform, Oanda.
Just 15 FTSE 100 constituents are in credit and if it is big gains you are looking for you need to look among the small-caps, where music streaming firm 7digital Group PLC (LON:7DIG) is up 10.3% after signing a deal with social media platform operator Triller, and floor coverings firm Airea PLC (LON:AIEA) is 14% firmer following half-year results.
11.15am: Footsie turns south as tumbleweed (metaphorically) blows across traders' screens
Well, that didn’t last long; the FTSE 100 is now in the red with retailers, house-builders and miners leading the retreat.
The top-shares index is only down 10 at 7,546, so stockbrokers will not exactly be venturing out on to the window ledge to contemplate their mortality; indeed, if Russ Mould, the quote-a-minute investment director of AJ Bell is to be believed, many market participants are already on the beach sipping a piña colada.
“The market is firmly in holiday mode with minimal corporate announcements and no movement from the FTSE 100 on Friday,” he said.
“Risk appetite looks weak at present, so markets may remain in a small trading range until there are clear catalyst to lift investor confidence, he added.
Kingfisher PLC (LON:KGF) is the worst performing blue-chip after yesterday’s ill-received trading update prompted brokers to cut their targets for the DIY specialist. So far, UBS, RBC and JPMorgan have all turned a bit more pessimistic.
Broker comment has also hit Kaz Minerals PLC (LON:KAZ), which is down 60p at 500.2p following the release of its interims yesterday.
“KAZ clarified some details on Baimskaya (Russia) that should help to address some investor concerns about the project. This was encouraging but in our view it is unlikely to change the market's negative perception of the project and KAZ are unlikely to provide more detailed operational/cost estimates to support the projects valuation until the feasibility study is complete in 2H19,” UBS said, as it slashed its target price to 660p from 940p.
9.45am: Footsie rouses itself but retail plays give back gains
Those traders not making an early start to the weekend drew encouragement from developments in China and Turkey.
The FTSE 100 was 21 points higher at 7,577 with investors prepared to be a bit more “risk on” following news China is to resume trade talks with the US and in view of some signs of stabilisation for the Turkish lira on the foreign exchange markets.
“The Lira was thrown a lifeline following reports of Qatar pledging $15 billion in direct investments for Turkey. Prices recovered further after the nation’s Finance Minister Berat Albayrak sought to calm investors during a conference call; however, buying sentiment towards the Lira was later dealt a blow, after the United States warned that Turkey will face more sanctions if the US pastor Andrew Brunson is not released,” said Lukman Otunuga at FXTM, summing up “an incredible rebound” for the Turkish currency against the greenback this week.
Housebuilders Barratt Developments PLC (LON:BDEV), Persimmon PLC (LON:PSN) and Taylor Wimpey PLC (LON:TW.) were not participating in the advance, while retail plays Ocado PLC (LON:OCDO) and J Sainsbury PLC (LON:SBRY) gave back some of the gains won yesterday in the wake of surprisingly good second-quarter figures for supermarket chain Asda.
Royal Bank of Scotland Group PLC (LON:RBS) was 0.5% firmer at 241.7p after it confirmed that Ewen Stevenson had resigned from his role as the chief financial officer. The price rise is no reflection on Stevenson; the shares were probably marked up as a result of an upgrade by HSBC.
8.45am: Tentative start
The FTSE 100 made another tentative start to the trading day, little moved by an apparent thawing of trade relations between the US and China and the stabilisation of the Turkish lira, allaying currency contagion concerns.
The index of blue-chip shares opened 4 points to the good at 7,560.31. Contrast that with the performance of the Dow Jones Industrial Average Thursday, which closed nearly 400 points to the good, boosted by a stellar earnings report from Wal-Mart and the seeming step back from the abyss by the world’s two largest economies.
Nerves this side of the Atlantic revolve around Brexit talks. “Traders will be watching keenly for any headlines indicating the likelihood of the UK crashing out of Europe without a deal,” said Jasper Lawler, market watcher for London Capital Group.
“Rating agencies, which had previously considered an orderly Brexit as the base case scenario are no longer willing to do so, highlighting the extent of the risk the UK now faces.”
There was little in the way of activity on the Footsie with the miners, having enjoyed a rare positive day Thursday, back on a downward trajectory.
Glencore (LON:GLEN), wasn’t able to resist the pull in spite of being upgraded by Liberum.
There was little movement for Royal Bank of Scotland (LON:RBS), which failed to cash in on an upgrade to ‘buy’ from HSBC.
Proactive news headlines:
SDX Energy Inc (LON:SDX, CVE:SDX) has revealed the success of production testing at the SD-3X appraisal well on the South Disouq field, in Egypt. The SD-3X well flowed at a maximum rate of 16.1mln cubic feet of gas per day over an eight hour clean-up, and, following a brief shut-in (with no pressure decline measured), further tests at varied choke sizes recorded rates of 5.3mln and 8.4mln cubic feet per day.
Victoria Oil & Gas PLC (LON:VOG) has told investors that it remains confident that a solution can be found to end the suspension of gas sales to power generator ENEO, and, said it remains actively engaged in the process. In the meantime, VOG highlighted that shortfalls in power supply continue as hydroelectric schemes are currently not meeting demand.
Motif Bio PLC’s (LON:MTFB) chief medical officer David Huang is to present data from the company’s lead drug candidate iclaprim at an upcoming microbiology conference in Portugal. Iclaprim is a next generation antibiotic which has initially been designed as a treatment for patients with acute bacterial skin and skin structure infections (ABSSSI).
Lancor Scientific is hosting an event next week to showcase its ground-breaking rapid cancer diagnostic.
Hello - For info, we're running our first low key event in a weeks time just near Liverpool Street station in London. Come along, meet the team and ask us any questions you have about the project. Spaces are limited - please register here: https://t.co/mQY635e57G
— Lancor Scientific (@LancorICO) August 15, 2018
6.45am: FTSE 100 set for subdued start
The FTSE 100 is expected to open relatively flat this morning but could see a boost from renewed optimism over US-China trade and the rebound of the Turkish Lira.
Spread betting firm IG expects the FTSE 100 to open flat at around 7,556, the same level the index closed at yesterday after a strong finish which saw it rise 58 points.
The markets were boosted yesterday following an announcement that the US and Chinese governments will reconvene negotiations later this month in an attempt to solve the current trade spat, a move which carried the positive sentiment into the Asian markets overnight.
However, David Madden, market analyst at CMC Markets UK, said that the announcement was “only the confirmation of talks restarting, and there is no guarantee that any trade deal will be reached”.
He noted that trade discussions have “a history of being protracted, and just because traders want a trade deal doesn’t mean they will get one”.
The positive trade news lifted the US markets yesterday, with the Dow Jones Industrial Average closing 396 points higher at 25,558, its best day in four months, while the S&P 500 closed up 22.3 points at 2,840 and the Nasdaq was up 32 points at 7,806.
In Asia today, the Japanese Nikkei 225 was up 90.9 points at 22,282, while Hong Kong’s Hang Seng was up 148 points at 27,248, lifted by renewed US-China discussions as well as a decent performance in tech stocks.
On the currency markets, the pound was relatively flat against the dollar and euro at US$1.27 and €1.11 respectively, with the latest US consumer sentiment survey and Eurozone consumer price index due on Friday, potentially causing more issues for sterling.
Sparse diary as week ends
Friday sees a spartan calendar with little on both the company and data diaries.
As investors and traders head off for the weekend there will be a parting shot from Global Ports Holding PLC (LON:GPH), which will release its interim results, while there will be data from across the Atlantic in the form of the latest US consumer sentiment survey.
Global Ports, the cruise port operator will be hoping to mitigate any potential declines from the recent UK heatwave that caused many holidaymakers to take a staycation as the British Isle sweltered.
The University of Michigan consumer sentiment index will be eyed for any indicators that could suggest the recent raft of tariffs and trade spats between the US and several other major economies may be denting consumer spending power across the Atlantic.
Significant announcements expected on Friday August 17:
Interims: Global Ports Holding PLC (LON:GPH)
Economic data: University of Michigan US consumer sentiment survey
Around the markets:
- Sterling: US$1.2723, no change
- Gold: US$1,176 an ounce, up 0.2%
- Brent Crude: US$71.39 a barrel, no change
City Headlines:
- The Daily Telegraph: The US’s move to ratchet up tariffs to 25% on $200 billion of Chinese goods this September would trigger a currency war, warn economists
- Financial Times: The Trump administration has warned that new sanctions would be imposed on Turkey if a detained American evangelical pastor was not released, putting further pressure on lira
- The Times: Schroders is considering replacing City grandee Bruno Schroder by his only daughter despite her lack of experience in financial services.