LONDON (Alliance News) - UK stocks were regaining ground Friday midday after a negative open caused by a sharp fall in Shanghai, while New York was expected to reopen slightly higher after the Thanksgiving holiday, catching up with the gains seen in European indices on Thursday.
The FTSE 100 index was still down 0.2% at 6,381.44 points, but the FTSE 250 was flat at 17,222.33 and the AIM All-Share was up 0.1% at 730.46. In Europe, the CAC 40 in Paris and the DAX 30 in Frankfurt were both up 0.2%.
Following Thursday's holiday, the New York market will be open just for half day Friday. The Dow Jones Industrial Average was called flat, the S&P 500 up 0.1% and the Nasdaq 100 up 0.2%.
"The dampened trading activity due to Thanksgiving is likely to continue today as many traders looks to extend their holiday weekend on Black Friday," said Hantec Markets analyst Richard Perry.
Asian stocks ended lower Friday. The Nikkei 225 index in Tokyo closed down just 0.3%, but the Shanghai Composite ended off 5.5% and the Hang Seng in Hong Kong down 1.9%.
Chinese stocks saw a sharp decline as the country's securities regulator urged domestic brokerages to cease financing clients' stocks purchases through over-the-counter swap contracts, in order to lessen leveraged financing risk in its stock markets after the summer stock rout.
Asian-focused financial stocks were sold following the news, with Standard Chartered down 1.2%, HSBC Holdings down 0.7%, and mid-cap Fidelity China Special Situations down 2.7%.
Oil stocks also were out of favour as crude prices slid back from their best levels of the past week. Brent oil was above the USD45 line at USD45.16 a barrel, having touched USD46.47 on Wednesday. West Texas Intermediate was at USD42.08 a barrel, beneath the USD43.43 mark reached on Tuesday.
BP was down 0.7%, Royal Dutch Shell 'B' shares down 0.5% and BG Group down 0.4%. Mid-caps Amec Foster Wheeler and Petrofac were down 1.9% and 1.4%, respectively.
Miners were giving back Thursday's gains, with the FTSE 350 Mining Sector index down 2.4%. Anglo American was down 5.5%, Antofagasta down 2.6% and BHP Billiton down 2.7%.
However, FTSE 250-listed Petra Diamonds was up 2.3%, after it said it has recovered a 23.16 carat pink diamond of "exceptional colour and clarity" from its Williamson mine in Tanzania.
The FTSE 350 General Retailers Sector index constituents were mixed, with the index up 0.2%, as the Black Friday shopping event got underway in the UK and US.
"Traders will be waiting to see who is first to report 'record sales' from today's shopping bonanza," said IG market analyst Alastair McCaig. "As ever the devil will be in the detail, and seasoned traders are only too aware that record sales do not automatically translate into record profits."
FTSE 100-listed water utility Severn Trent was up 0.7% after being upgraded to Hold from Sell by Investec.
In the FTSE 250. Zoopla Property was up 2.2% after Exane BNP raised the property portal company to Neutral from Underperform. Bookmaker Betfair added 1.6% after Deutsche upgraded it to Buy from Neutral. But drinks company Britvic was down 0.8% after HSBC cut it to Hold from Buy.
Pennon Group was up 3.4%. The water company said Friday its profit and earnings both improved in the first half thanks to energy recovery facilities in its Viridor business and a better-than-expected contribution from recently-acquired Bournemouth Water.
Pennon, which owns South West Water and waste management business Viridor, along with the recently-acquired Bournemouth Water unit, said its pretax profit for the six months to the end of September was GBP106.8 million, up from GBP100.0 million a year earlier.
SVG Capital was adding 3.1% after the private equity investor said there is a need for "discipline and caution" amid a tough macro environment.
"The company's strong balance sheet positions us well to cover our liabilities, take advantage of any investment opportunities as they arise, as well to mitigate any short-term volatility," Chief Executive Lynn Fordham said in a statement.
Fordham's comments came as SVG said it has reaped the benefits of a strategy implemented in 2012, with investments made following that year showing a total return of 7.0% in the quarter and 10% over the nine months to October 31.
On AIM, Anglesey Mining was down 22%. The miner said it remains positive of a recovery within the resources sector in a "sensible time frame", although it warned its short- to medium-term outlook remains "somewhat unclear", as it reported a narrowed pretax loss for its first half.
In a light economic calendar, second estimates published by the Office for National Statistics showed that the UK economic growth slowed as estimated in the third quarter.
Gross domestic product climbed 0.5% from prior quarter, unrevised from the prior estimate released on October 27. This was the eleventh consecutive quarters of positive growth. In the second quarter, the economy had expanded 0.7%. On a yearly basis, GDP rose 2.3%, in line with preliminary estimate.
Eurozone economic confidence remained unchanged in November as increases in sentiment among consumers and in services and construction were offset by deteriorating confidence in manufacturing and retail trade. The economic confidence index came in at 106.1, unchanged from October. The expected score was 105.9.
By Daniel Ruiz; danielruiz@alliancenews.com
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5 Nov 2015 12:10
