Michele Maatouk WebFG News | 10 Nov, 2017 12:18 | | |
London stocks had reversed small gains to trade lower by midday on Friday as investors mulled over the latest data on manufacturing, industrial production and construction
The FTSE was down 0.4% to 7,457.29, as the pound nudged up 0.1% against the euro and the dollar to 1.1300 and 1.3152, respectively.
Official data showed UK industrial production is increasing more than expected, with manufacturing activity continues to grow but the construction sector entering a technical recession.
Industrial production rose by 0.7% month-on-month in September, the Office for National Statistics revealed, up from 0.4% a month earlier and above the consensus forecast of 0.3%.
Production for the third quarter was also now estimated to have increased by 1.1% quarter-on-quarter, up from 1.0% as September’s production was revised up from the 0.3% expansion pencilled in by the ONS in its preliminary estimate of GDP.
This, the sixth monthly increase in a row, was thanks to a 0.7% increase in manufacturing production, similarly beating a 0.3% consensus and up from 0.4% last time.
A 2.2% rebound in mining and quarrying output, following a two month lull, also contributed, offsetting flat output in the energy supply sector and a 0.1% fall in water.
Meanwhile, UK construction output slumped 1.6% in September, way worse that the 0.3% expected after an August that was revised up to 0.8% growth, and larger than the 1.0% drop the ONS had initially pencilled in its quarterly estimate.
In trade data, export volumes fell by 1.8% on the quarter, compared with a 1.9% quarterly rise in imports.
Chris Williamson, chief business economist at IHS Markit, said official data was now confirming the UK was a multi-speed economy, with manufacturing enjoying strong growth and construction in the doldrums, entering a new technical recession.
"It’s encouraging to see sectors such as machinery and equipment recording strong growth in the third quarter, where output was up 3.0%, as this is a good indicator of rising business investment. It remains unclear, however, as to how much of this was exported or intended for domestic customers," he said.
In corporate news, EasyJet flew higher after the budget carrier announced the appointment of Johan Lundgren as its new chief executive, replacing Carolyn McCall, whose departure was announced back in July.
Vedanta Resources ticked up as it reported revenue growth of 39% year-on-year in its first half to $6.8bn, while EBITDA was up 37% to $1.7bn.
Galliford Try was on the front foot after the company said its council partnerships arm has benefited from "increased certainty" following recent government announcements and has a record order book, while housebuilding sales rates and the construction order book have remained unchanged since the year end.
Plumbing and heating products distributor Ferguson – formerly Wolseley – advanced as it agreed to sell its Nordics building materials distribution business, Stark Group, to an affiliate of private equity firm Lone Star Funds for €1.03bn on a debt-free and cash-free basis.
On the downside, retailers AB Foods, Marks & Spencer and Kingfisher retreated after the BOD's High Street Sales Tracker data showed UK retailers had their worst October for high street sales in a decade, with an unusually warm autumn blamed for putting the mockers on sales of coats and other seasonal wear.
Student accommodation developer and manager Unite Group dipped after exchanging contracts to acquire a development site in Leeds on a subject-to-planning basis.
Ultra Electronics fell sharply after saying that a decision from the US Department of Justice about its proposed acquisition of NYSE-listed Sparton is now expected at the end of March 2018. Ultra Electronics was also cut to ‘sell’ from ‘hold’ at Berenberg on Friday.
Capita ticked down as it agreed with the Financial Conduct Authority to pay up to £66m to investors who suffered losses due to a high-risk investment scheme known as the Connaught Scheme.
Shares in luxury fashion house Burberry were under the cosh again after a downgrade to ‘underperform’ at Bernstein, while Serco was under pressure after a downgrade to ‘sell’ at Liberum Capital.
Bunzl was weaker as Morgan Stanley recommended switching to Rexel to benefit from the unwinding of Bunzl's premium.
FTSE 100 - Risers
Barratt Developments (BDEV) 619.50p 1.23%
Standard Life Aberdeen (SLA) 417.10p 0.99%
Imperial Brands (IMB) 3,183.00p 0.92%
Rio Tinto (RIO) 3,710.00p 0.87%
easyJet (EZJ) 1,281.00p 0.87%
Intertek Group (ITRK) 5,395.00p 0.84%
Persimmon (PSN) 2,684.00p 0.83%
Royal Bank of Scotland Group (RBS) 275.70p 0.73%
International Consolidated Airlines Group SA (CDI) (IAG) 600.00p 0.67%
Glencore (GLEN) 365.30p 0.63%
FTSE 100 - Fallers
Bunzl (BNZL) 2,172.00p -5.89%
Burberry Group (BRBY) 1,716.00p -3.97%
SSE (SSE) 1,351.00p -3.08%
Associated British Foods (ABF) 3,058.00p -1.74%
Marks & Spencer Group (MKS) 320.00p -1.60%
Centrica (CNA) 165.60p -1.49%
Fresnillo (FRES) 1,305.00p -1.36%
Rolls-Royce Holdings (RR.) 928.00p -1.17%
Johnson Matthey (JMAT) 3,368.00p -1.14%
Kingfisher (KGF) 306.30p -1.13%
FTSE 250 - Risers
Halfords Group (HFD) 319.90p 2.93%
Ferrexpo (FXPO) 260.80p 2.68%
Alfa Financial Software Holdings (ALFA) 490.50p 2.19%
Wizz Air Holdings (WIZZ) 3,166.00p 2.03%
Kaz Minerals (KAZ) 818.50p 1.87%
Renishaw (RSW) 5,235.00p 1.75%
CYBG (CYBG) 317.50p 1.60%
Intermediate Capital Group (ICP) 950.50p 1.55%
Evraz (EVR) 291.90p 1.53%
Rathbone Brothers (RAT) 2,506.00p 1.50%
FTSE 250 - Fallers
Ultra Electronics Holdings (ULE) 1,597.00p -6.99%
Petrofac Ltd. (PFC) 420.20p -4.52%
Serco Group (SRP) 109.60p -2.66%
Big Yellow Group (BYG) 741.50p -2.50%
Cobham (COB) 130.60p -2.32%
Playtech (PTEC) 821.00p -2.26%
TBC Bank Group (TBCG) 1,715.00p -2.00%
Royal Mail (RMG) 375.40p -1.98%
Intu Properties (INTU) 207.50p -1.98%
Sophos Group (SOPH) 587.50p -1.92%
Stocks reversed early gains as investors opted to play it safe going into the weekend and the euro edged a tad higher on the back of the political gyrations on Capitol Hill.
Stocks have started the morning trading slightly higher, tracking overnight gains on Wall Street but analysts are worried about buying into Thursday's bounce.
London's top flight index slipped on Friday, but managed to finish well-off its lows of the session despite renewed Brexit angst as the pound gave back early gains.
DIY retailer Kingfisher has more "reasons to be cheerful" thanks to an improving French outlook, analysts at RBC Capital Markets said on Friday, while clothes seller Supergroup remains "compelling" but its shares have gained a lot in recent weeks.
Real estate investment group Alpha Real Trust saw its net asset value (NAV) rise in its first half of trading as it moved to make further investments in build-to-rent projects.
Industrial and logistics-focussed real estate investment trust Pacific Industrial & Logistics has completed the sale of an asset located at Hammond Road, Bedford, for a total consideration of £5.8m, it announced on Friday.
DP Poland, which holds the exclusive master franchise for the Domino’s Pizza brand in Poland, celebrated the opening of its 50th location in the country on Friday.
National investment group Mercia Technologies has made a new direct investment into Aston EyeTech - a spinout from Aston University, Birmingham - which has developed a range of proprietary hardware and software products in ocular care, it announced on Friday.
Modelling, simulation and training solutions provider SimiGon has now received final regulatory approval for a $2m purchase order received from the Israeli Air Force, initially announced on 20 June 2016, it confirmed on Friday.
Agricultural investment group Agriterra saw losses widen in the first half of its trading year as subdued demand for its maize flour products slashed revenues by more than a third.