Michele Maatouk Sharecast | 14 Jul, 2017 12:14 | | |
London stocks were nudging lower by midday as investors digested the first in a series of second-quarter earnings from US banking heavyweights, with JPMorgan, Wells Fargo and Citigroup all on the slate on Friday.
The FTSE 100 was down 0.2% to 7,400.72, while the pound was up 0.1% versus the euro at 1.1365 and 0.2% firmer against the dollar at 1.2969.
Accendo Markets analyst Mike van Dulken said: “In focus today will be the start of Q2 earnings season in the US. The big Banks open proceedings via JPMorgan, Wells Fargo and Citigroup, all rallying in recent weeks on expectations of big dividends/buybacks following Fed approval.
“Consensus has been guided lower as per usual, so prepare for consensus/guidance beats. But Wall St still expects a mixed showing amid pressure on trading from very low market volatility, limited deal-making (M&A/IPOs) and slower lending volumes. Are Fed hikes helping net interest margins and profitability? Outlook will likely be key.”
Investors will be hoping that JPMorgan set the tone with its earnings, as both profit and revenue at the bank beat analysts’ estimates.
Meanwhile, on the UK corporate front, Royal Mail retreated as it announced changes to its pension plan, giving its workers a choice between a defined-benefit and a defined-contribution scheme.
International sales, marketing and support services group DCC was a touch weaker as it said first quarter trading was in line with expectations and it expected the full year to produce “profit and growth”.
Electrical and telecoms retailer Dixons Carphone fell after agreeing to sell its entire holdings in The Phone House Spain, along with its related companies Connected World Services Europe and Smarthouse, to Bilbao-based technological services firm Global Dominion Access, it announced on Friday.
Acacia Mining was in the red after it said it will start paying a higher royalty to the Tanzanian government for its production of gold and copper of 6%, up from 4%, after new mining regulations were drawn up following an export dispute.
Emerging markets asset manager Ashmore was on the back foot after reporting a 5% jump in fourth-quarter assets thanks to a positive investment performance and net inflows.
Recruiter Hays was trading flat, giving up earlier gains despite saying it expects full-year profits to be ahead of market forecasts, while Workspace edged up after noting strong customer demand in the first quarter.
Carillion surged as it hired HSBC as its second financial adviser and joint corporate broker with immediate effect, although it also lost a contract.
FTSE 100 - Risers
Tesco (TSCO) 174.55p 1.07%
Standard Life (SL.) 414.90p 0.97%
Shire Plc (SHP) 4,208.00p 0.79%
Rio Tinto (RIO) 3,446.00p 0.76%
Mediclinic International (MDC) 745.50p 0.61%
BHP Billiton (BLT) 1,297.50p 0.58%
Pearson (PSON) 632.50p 0.56%
Antofagasta (ANTO) 856.50p 0.53%
Anglo American (AAL) 1,099.50p 0.50%
International Consolidated Airlines Group SA (CDI) (IAG) 627.00p 0.48%
FTSE 100 - Fallers
Royal Mail (RMG) 400.50p -2.55%
Barratt Developments (BDEV) 590.50p -1.67%
AstraZeneca (AZN) 4,942.00p -1.42%
Convatec Group (CTEC) 295.00p -1.17%
Kingfisher (KGF) 295.30p -1.14%
Persimmon (PSN) 2,373.00p -1.08%
ITV (ITV) 175.40p -1.07%
Admiral Group (ADM) 2,029.00p -1.02%
Associated British Foods (ABF) 2,887.00p -0.96%
Mondi (MNDI) 2,022.00p -0.93%
FTSE 250 - Risers
Carillion (CLLN) 59.15p 6.67%
Derwent London (DLN) 2,719.00p 2.53%
Clarkson (CKN) 2,622.00p 1.63%
IP Group (IPO) 135.40p 1.50%
CLS Holdings (CLI) 202.90p 1.45%
Genus (GNS) 1,753.00p 1.39%
Telecom Plus (TEP) 1,125.00p 1.35%
Great Portland Estates (GPOR) 603.50p 1.34%
Hunting (HTG) 489.10p 1.30%
Renishaw (RSW) 3,920.00p 1.29%
FTSE 250 - Fallers
Sophos Group (SOPH) 446.30p -2.85%
Ashmore Group (ASHM) 340.80p -2.85%
Rank Group (RNK) 222.70p -1.85%
Galliford Try (GFRD) 1,262.00p -1.79%
Redefine International (RDI) 38.93p -1.72%
TalkTalk Telecom Group (TALK) 185.40p -1.64%
Countryside Properties (CSP) 343.60p -1.43%
Dixons Carphone (DC.) 260.80p -1.40%
Acacia Mining (ACA) 278.00p -1.38%
Ascential (ASCL) 322.20p -1.35%
Stocks on the Continent finished mostly higher on the back of strong survey readings on the euro area's manufacturing and services sector and ahead of the German general elections at the weekend, although fresh barbs from Pyongyang were a drag on sentiment.
Thousands of steel workers gathered in Western Germany on Friday to protest the proposed merger of ThyssenKrupp and Tata Steel's European operations which was expected to result in approximately 4,000 job losses.
London stocks had reversed earlier losses to trade a little higher by Friday's close, helped along by a weaker pound as investors weighed up a key speech by Prime Minister Theresa May.
Polish Deputy Prime Minister Mateusz Morawiecki announced on Friday that US bank JP Morgan Chase had picked Warsaw to play host to its new global operations centre, bringing thousands of jobs to the region from the beginning of 2018.
The FTSE 250 index was on the front foot on Friday, led by retailer Pets at Home and a group of oil-related companies.
In a speech in Florence on Friday, Prime Minister Theresa May confirmed that she wanted a two-year "implementation period" post-Brexit and a new treaty with the European Union on security and justice.
London's FTSE 100 was up 0.6% to 7,305.66 in afternoon trade on Friday as investors mulled over PM Theresa May's Brexit speech in Florence.
22 Sep Results round-up
Saga, the specialist provider of products and services for those over 50, reported solid growth of 5.5% in underlying profits before tax for the first half as it ordered a second new cruise ship amid high demand.
Business activity in the US picked up in September despite hurricanes Harvey and Irma, as growth in the manufacturing sector helped to offset an easing in services, according to preliminary data released on Friday.
Thalassa Holdings confirmed the suspension of its share buyback programme on Friday, as a suitor continued to circle the marine geoscience and subsea robotics company.