London open: Stocks in the red as pound gains; OPEC meeting in focus
London stocks fell in early trade on Thursday, weighed down by a stronger pound as investors looked to the OPEC meeting in Vienna later in the day.
At 0830 GMT, the FTSE 100 was down 0.4% to 7,364.30, while the pound was up 0.3% against the euro and the dollar at 1.1353 and 1.3455, respectively, Cable's highest level since late September. However, the FTSE 250 mid-cap index, which is less exposed to the pound's whims, was also in the red.
The pattern for the bluechip benchmark was continuing from the previous session, said Spreadex analyst Connor Campbell, with the FTSE struggling under the weight of sterling’s rise.
"Despite the reported £50bn Brexit divorce bill breakthrough being just one part of a trio of issues preventing the UK and EU from unlocking trade talks - the others are the Irish border and citizens’ rights - the pound has continued to cheer the signs of progress this Thursday."
As far the OPEC meeting is concerned, investors are expecting oil ministers to extend the output freeze by another nine months until the end of 2018.
Brexit will remain in focus after Prime Minister Theresa May insisted the UK is still negotiating with the EU over a divorce payout, following reports of a divorce bill of up to £50bn. May has until Monday to make a fresh offer on key divorce issues if the UK is to move ahead to the next step in Brexit talks.
Investors were also digesting the latest survey from Nationwide, which showed annual UK house price growth was stable in November.
House prices grew by 2.5% this month, unchanged from November last year and missing expectations for a 2.7% increase. On the month, prices were 0.1% higher, down from a 0.2% rise in October and below expectations for it to remain unchanged.
Meanwhile, the latest survey from GfK showed UK consumer confidence ebbed more than expected this month.
GfK's consumer confidence index fell to -12, the same level as the month after the Brexit vote, down from -10 the month before and slightly worse than the City forecasts of -11.
In corporate news, GlaxoSmithKline fell as it announced that ViiV Healthcare, the global specialist HIV company it majority owns with Pfizer and Shionogi as shareholders, has confirmed the start of HPTN 084 - a phase III study to evaluate long-acting cabotegravir for the prevention of HIV infection in sexually active women.
TP ICAP was on the back foot as it announced it has acquired independent agency broker Coex Partners for an initial payment of £7.1m, with performance-related payments possible at various dates over the next four years.
Pub operator Greene King fell sharply after reporting an 8% drop in interim underlying pre-tax profit.
Residential landlord Grainger declined even as it posted a 2% increase in full-year pre-tax profit, while Babcock International slumped as Goldman Sachs removed the stock from its Conviction Buy list.
Oil services group Lamprell gushed lower after warning that earnings for 2017 are likely to be "materially below" current market expectations as its East Anglia offshore windfarm project is expected to make a "significant" loss.
Bellway, Telecom Plus, Johnson Matthey, IAG and Land Securities were all weaker as their stock went ex-dividend.
Going the other way, life insurer Aviva rallied as it upped its long-term earnings and dividend guidance and said it has £3bn of excess cash that will be used to pay down £0.9bn debt next year, as well as making bolt-on acquisitions and funding shareholder returns.
BAE Systems was in the black after agreeing to pay more into its pension schemes to deal with a £2.1bn deficit by the year 2026.The defence company said it would increase payments into the schemes from about £205m a year to £220m from 2018 with payments rising in line with group dividends.
Pub operator Marston's surged after it posted a 10% jump in full-year revenue and a 3% rise in pre-tax profit.
Go-Ahead rose after the rail operator maintained its full-year expectations as it said revenues from its train services have risen in recent months.
Market Movers
FTSE 100 (UKX) 7,364.30 -0.40%
FTSE 250 (MCX) 19,969.01 -0.45%
techMARK (TASX) 3,440.62 -0.64%
FTSE 100 - Risers
BAE Systems (BA.) 561.00p 3.12%
Aviva (AV.) 523.50p 2.85%
Mediclinic International (MDC) 552.50p 2.31%
Imperial Brands (IMB) 3,072.00p 0.85%
British American Tobacco (BATS) 4,842.00p 0.83%
Unilever (ULVR) 4,249.50p 0.79%
SSE (SSE) 1,371.00p 0.66%
Diageo (DGE) 2,605.00p 0.44%
Anglo American (AAL) 1,378.91p 0.21%
National Grid (NG.) 881.60p 0.18%
FTSE 100 - Fallers
Babcock International Group (BAB) 683.25p -2.18%
NMC Health (NMC) 2,838.00p -1.80%
Johnson Matthey (JMAT) 3,006.00p -1.73%
Micro Focus International (MCRO) 2,454.90p -1.73%
International Consolidated Airlines Group SA (CDI) (IAG) 600.50p -1.56%
Convatec Group (CTEC) 188.20p -1.52%
Next (NXT) 4,437.00p -1.47%
Berkeley Group Holdings (The) (BKG) 3,786.00p -1.46%
Land Securities Group (LAND) 916.50p -1.45%
Shire Plc (SHP) 3,664.50p -1.40%
FTSE 250 - Risers
Marston's (MARS) 115.20p 9.92%
Stagecoach Group (SGC) 187.00p 3.43%
P2P Global Investments (P2P) 793.00p 3.26%
Cineworld Group (CINE) 570.50p 2.42%
RPC Group (RPC) 914.50p 2.24%
888 Holdings (888) 264.70p 2.00%
Fidessa Group (FDSA) 2,496.00p 1.79%
Go-Ahead Group (GOG) 1,628.00p 1.75%
Vectura Group (VEC) 95.35p 1.44%
UDG Healthcare Public Limited Company (UDG) 836.00p 1.39%
FTSE 250 - Fallers
Greene King (GNK) 510.00p -5.56%
Redefine International (RDI) 35.61p -4.17%
Euromoney Institutional Investor (ERM) 1,137.00p -3.23%
Genus (GNS) 2,306.00p -2.66%
Vedanta Resources (VED) 704.50p -2.49%
Bellway (BWY) 3,464.00p -2.48%
TalkTalk Telecom Group (TALK) 141.82p -2.39%
Sophos Group (SOPH) 590.00p -2.24%
Telecom Plus (TEP) 1,182.00p -2.23%
Kaz Minerals (KAZ) 732.00p -2.20%