Admiral Share News (ADM)

(Alliance News) - Stocks in London opened lower on Thursday with ex-dividend shares weighing on the FTSE 100, while CMC Markets fell sharply after warning on operating income.

The FTSE 100 index was down just 2.46 points at 7,147.38. The mid-cap FTSE 250 index was down 66.50 points, or 0.3%, at 24,184.33. The AIM All-Share index was down 0.1% at 1,303.71.

The Cboe UK 100 index was down 0.1% at 710.41. The Cboe 250 was down 0.2% at 21,988.52, and the Cboe Small Companies was flat at 15,567.81.

In mainland Europe, the CAC 40 stock index in Paris was up 0.1%, while the DAX 30 in Frankfurt was up 0.1%.

In the FTSE 100, Melrose Industries was the best performer, up 4.6%, after the industrial turnaround specialist said it was trading ahead of expectations and saw scope to return more cash to shareholders next year.

For the six months to June 30, revenue rose to GBP3.54 billion from GBP3.39 billion last year and its pretax loss narrowed to GBP256 million from GBP720 million.

Melrose declared an interim dividend of 0.75p per share, having skipped its payout last year. It did recently, however, unveil a GBP730 million return to shareholders after completing the sale of its Nortek Air Management division.

At the other end of the large-caps, BHP Group and Admiral were the worst performers, down 5.5% and 4.7% respectively, after the stocks went ex-dividend meaning new buyers no longer qualify for the latest payout.

Barratt Developments was down 2.4%, even as the housebuilder reported strong annual results.

Barratt Developments said financial 2021 was a year in which the housebuilder made "excellent progress" and that it started the new financial year in a strong position.

For the financial year ended June 30, revenue rose 41% to GBP4.81 billion from GBP3.42 billion a year ago and pretax profit was GBP812.2 million, up 65% from GBP491.8 million. The pretax profit figure was at the top end of the company compiled consensus range of GBP761 million to GBP812 million.

During the period, Barratt completed 17,243 homes, up 37% from 12,604 completed last year and was in line with guidance given in July.

In addition, Barratt declared a total dividend of 29.4 pence, having paid out nothing the year before.

Commenting on the results, interactive investor's Richard Hunter said: "Elements of caution inevitably remain, as the fallout from the withdrawal of UK government support schemes, spiking inflation and potentially fragile consumer sentiment could all impact the [housing] sector in general. Costs are still ongoing to repair some of the its legacy properties, although largely contained."

Unilever was down 2.1% after Barclays downgraded the consumer goods firm to Underweight from Neutral.

In the FTSE 250, Homeserve was the best performer, up 3.5%, after Barclays raised the home emergency cover provider to Overweight from Equal Weight.

Languishing at the bottom of the FTSE 250, CMC Markets was down 28% after the contract-for-difference provider warned on operating income after a subdued period of summer trading.

For the five month period which ended on Tuesday, CMC said it entered the current financial year with significant momentum following a year of record performance.

However, offsetting this, CMC said overall market activity has remained subdued through July and August following on from the moderation in activity reported in the first quarter.

The spread betting firm explained reduced volatility in markets resulted in lower trading activity across both the newly acquired and existing clients. Further, similar trends have been seen across its non-leveraged and leveraged businesses.

CMC said in addition to lower activity, year to date client income retention has been tracking moderately below its 80% target, although is expected to recover through the remaining seven months of the year based on a reversion towards historical averages in the mix of asset class trading.

As such, CMC warned that should current market conditions prevail for the remainder of the year, it now expects annual 2022 net operating income to settle in a range between GBP250 million to GBP280 million. CMC posted net operating income of GBP409.8 million for the financial year ended March 31.

Financial 2022 operating costs will continue to track moderately higher year-on-year, although partly offset by lower marketing costs in line with lower activity trends, CMC added.

The Japanese Nikkei 225 index closed up 0.3%. In China, the Shanghai Composite ended up 0.8%, while the Hang Seng index in Hong Kong was up 0.1%. The S&P/ASX 200 in Sydney ended 0.6% lower.

The pound was quoted at USD1.3776 early Thursday, down from USD1.3786 at the London equities close Wednesday.

The euro was priced at USD1.1840, down from USD1.1858. Against the yen, the dollar was trading at JPY110.01, marginally lower from JPY110.04.

Brent oil was quoted at USD71.42 a barrel Thursday morning, up from USD70.76 late Wednesday. Gold was trading at USD1,813.23 an ounce, flat from USD1,812.84.

The world's leading oil producers on Wednesday upheld a deal reached just over a month ago to boost output gradually despite US pressure to go further.

After weeks of wrangling, members of the Organization of Petroleum Exporting Countries along with allies such as Russia, known collectively as OPEC+, agreed in July to raise output by 400,000 barrels per day from August.

The move is aimed at supporting a global economic recovery, which has been battered by the coronavirus pandemic - a crisis that sent oil demand plummeting last year.

Thursday's economic calendar has eurozone producer prices at 1000 BST before the latest US jobless claims data at 1330 BST.

By Arvind Bhunjun; arvindbhunjun@alliancenews.com

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