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London midday: Stocks steady ahead of ECB; Countrywide craters on results

Thu, 8th Mar 2018 10:59

(ShareCast News) - Equity indices in London were steady by midday on Thursday ahead of the latest monetary policy statement from the European Central Bank and as the US began to make concessions on trade.

Stocks in Asia finished on the front foot after stocks on Wall Street pared early losses overnight on reports that Canada and Mexico could get exemptions from Trump's planned import tariffs on steel and aluminium.

The FTSE 100 was flat at 7,158.96 as a host of stocks went ex-dividend as usual on Thursday, while the FTSE 250 mid-cap index was up 0.4% to 19,853.33. The pound was down 0.3% against the dollar at 1.3857 and up 0.1% versus the euro at 1.1202.

On the simmering US trade tension, CMC Markets analyst Michael Hewson said: "We should get the final details in the next day or so with reports that President Trump will announce the details either today or tomorrow, while markets will also be paying attention as to who will replace Mr Cohn. There were concerns that Peter Navarro, one of President Trump's more hawkish trade advisors might be in the frame for the role, however he appeared to rule himself out yesterday."

With little else in terms of economic catalysts on International Women's Day, analysts said the ECB interest rate decision at 1245 GMT and president Mario Draghi's speech at 1330 GMT will be keenly watched by traders. The latest ECB staff projections will also provide some grist for the market mill and Draghi's Q&A session will be scrutinised for any "subtle shift in rhetoric" as to what might happen after September this year when the current bond buying programme is due to end, said Lee Wild at broker Interactive Investor.

Back in the UK, investors were digesting the latest RICS residential survey, which showed the balance of surveyors reporting that house prices have risen over the last three months fell to zero in February from +8 in January, below the consensus +7. The new buyer enquiries balance fell to -16, from -11 in January, remaining below zero for the 11th consecutive month.

"The downturn in housing market activity accelerated in February, indicating that the stimulus to demand from the Chancellor's stamp duty reforms has been outweighed by the prospect of further increases in interest rates," said economist Samuel Tombs at Pantheon Macroeconomics.

He noted that new buyer demand has not fallen for such a protracted period since the 2008/09 financial crisis.

In corporate news, Aviva was down despite a bullish full year report. Earnings per share grew 7% and the dividend 18% and the life insurer upgraded its growth targets to aim above 5% EPS growth from 2018, with 55-60% to be paid out in dividends.

Retailer Next was in the red on news that it's facing a demand for up to 30m in back pay from thousands of mostly female shop-floor employees as it emerged that they were being paid an average of 2 an hour less than male warehouse workers.

More broadly, the retail sector was in focus as department store chain John Lewis revealed a 77% drop in annual profits amid subdued consumer demand and margin pressure.

G4S fell even though the security company reported a 6.5% rise in underlying annual profit and that the outlook for its business was good.

Shares in estate agency Countrywide tumbled as it said it swung to a loss in 2017, scrapped its dividend and sounded a cautious note on its outlook.

Randgold Resources dropped after a meeting with the president of the Democratic Republic of Congo produced little assurances for mining companies over their concerns about the country's new mining code.

AA was under the cosh as it emerged that former boss Bob Mackenzie is suing the roadside assistance company and insurer for up to 220m, claiming he was victimised while he suffered from stress.

Software developer Alfa Financial Software Holdings took a beating as it warned that growth in the current year will be slower due to a weaker dollar.

Persimmon was among the top fallers as it was one of the band of stocks going ex-dividend, also including BHP, CRH, Land Securities, Standard Chartered and Thomas Cook.

On the upside, Domino's Pizza UK & Ireland scooted higher as sales increased 15% but profits only by 10%. UK sales in the first eight weeks of 2018 were said to have got off to a strong start.

Euromoney Institutional Investor advanced after completing the acquisition of research outfit Extel from WeConvene.

Primark owner Associated British Foods was lifted by an upgrade to 'buy' at Goldman Sachs while Britvic rallied as Morgan Stanley bumped it up to 'overweight' after a material pull-back in the shares lately.

Premier Oil gushed higher after an upgrade to 'outperform' at RBC Capital Markets, while Weir gained on the back of an initiation at 'buy' by Liberum.

Market Movers

FTSE 100 (UKX) 7,158.96 0.02%

FTSE 250 (MCX) 19,853.33 0.40%

techMARK (TASX) 3,371.23 0.82%

FTSE 100 - Risers

Mediclinic International (MDC) 590.60p 2.11%

WPP (WPP) 1,234.50p 1.98%

ITV (ITV) 154.70p 1.81%

SSE (SSE) 1,249.50p 1.38%

Sage Group (SGE) 691.80p 1.29%

National Grid (NG.) 789.30p 1.26%

Johnson Matthey (JMAT) 3,177.00p 1.18%

GlaxoSmithKline (GSK) 1,335.92p 1.13%

Direct Line Insurance Group (DLG) 383.28p 1.10%

Associated British Foods (ABF) 2,613.00p 1.08%

FTSE 100 - Fallers

G4S (GFS) 252.50p -4.36%

Persimmon (PSN) 2,535.00p -4.09%

BHP Billiton (BLT) 1,390.40p -3.69%

Evraz (EVR) 439.70p -3.38%

Smurfit Kappa Group (SKG) 3,144.00p -2.30%

Anglo American (AAL) 1,723.40p -2.02%

Marks & Spencer Group (MKS) 282.50p -1.91%

CRH (CRH) 2,419.23p -1.82%

Aviva (AV.) 498.60p -1.77%

Antofagasta (ANTO) 861.60p -1.67%

FTSE 250 - Risers

Ultra Electronics Holdings (ULE) 1,441.00p 7.14%

Britvic (BVIC) 723.50p 6.09%

Euromoney Institutional Investor (ERM) 1,300.00p 6.04%

Cineworld Group (CINE) 238.00p 5.40%

Vectura Group (VEC) 77.89p 5.26%

Stobart Group Ltd. (STOB) 236.50p 3.73%

Hill & Smith Holdings (HILS) 1,345.00p 3.70%

Ibstock (IBST) 297.80p 3.26%

TalkTalk Telecom Group (TALK) 111.30p 3.25%

BCA Marketplace (BCA) 160.20p 3.22%

FTSE 250 - Fallers

Alfa Financial Software Holdings (ALFA) 404.08p -15.46%

AA (AA.) 77.92p -8.72%

John Laing Group (JLG) 262.00p -4.45%

Jupiter Fund Management (JUP) 498.90p -3.91%

Ferrexpo (FXPO) 305.40p -3.39%

CLS Holdings (CLI) 236.50p -3.27%

IP Group (IPO) 110.20p -2.65%

Dixons Carphone (DC.) 187.45p -2.45%

Hunting (HTG) 682.50p -2.43%

Vedanta Resources (VED) 726.20p -2.31%

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