LONDON (Alliance News) - UK stocks were lower just after the open Tuesday, despite initially opening higher following on from a strong Wall Street performance, while brewer SABMiller traded down after it released an unscheduled trading update, saying first half revenue was hit by unfavourable movements in foreign exchange rates.
The FTSE 100 traded down 0.3% at 6,279.26, the FTSE 250 was down 0.2% at 17,084.82 and the AIM All-Share was flat at 733.53.
UK house prices dropped unexpectedly in September, data from Lloyds Banking Group's Halifax division revealed Tuesday just after the market open. House prices slid 0.9% month-on-month in September, reversing August's 2.7% increase, which was the biggest monthly growth in 15 months. Economists had forecast prices to gain 0.1%.
European stocks also were lower, with the CAC 40 in Paris down 0.3% and the DAX 30 in Frankfurt down 0.5%.
Before the London open, data from Destatis revealed Germany's factory orders declined in August as both domestic and foreign demand deteriorated from July. Factory orders dropped 1.8% month-on-month in August, confounding expectations for a 0.5% rise. Orders had declined 2.2% in July, which was revised from a 1.4% drop estimated initially. This was the second consecutive decrease in orders.
On Wall Street on Monday, the Dow Jones Industrial Average closed up 1.9%, the S&P 500 index up 1.8% and the Nasdaq Composite up 1.6% amid renewed hopes the Federal Reserve will delay raising interest rates following weak services data.
In Asia, the Shanghai market is closed until Thursday. The Nikkei 225 index closed up 1.0% on Tuesday and the Hang Seng in Hong Kong is down 0.6%.
Brewing giant SABMiller traded down 1.3%, making it one of the worst performers in the FTSE 100 at the open. The company said group net producer revenue in the six months ended September 30 fell 9% on the year before, also falling 9% in the second quarter to the same date, which it said was due to the continued depreciation of its key operating currencies against the US dollar.
On an organic, constant currency basis, net producer revenue grew 4% year-on-year.
Beverage volume increased by 2% in the second quarter and 1% in the first half, leaving NPR per hectolitre up 4% in the quarter and also 4% in the half.
SAB said it had brought forward its half-year trading update as it is in an offer period under the UK Takeover Code, resulting from the bid approach from Anheuser-Busch InBev last month.
In the FTSE 250, shares in Greggs were up 4.7% after it reported growth in sales in the third quarter of its financial year and said it expects to report full-year growth slightly ahead of previous expectations amid favourable market conditions.
Greggs said that total sales in the 13 weeks to October 3 rose 5% on the same period the year before, while own-shop like-for-like sales grew 4.9%, slightly ahead of its expectations. In the year to date, total sales grew 5.1% and own-shop like-for-likes rose 5.6%.
The bakery and food-to-go retailer also said the new UK National Living Wage will raise its costs, but noted that it already pays staff above the current minimum.
On the other side of the mid-cap index, Acacia Mining led the fallers, down 13%. The miner said its production output in the third quarter was weaker than anticipated and said its full-year production will now fall below previous guidance.
Acacia said its production in the third quarter was around 164,000 ounces of gold, lower than its had expected due to several short-term issues which hit production at its Bulyanhulu and Buzwagi mines over the period to the end of September, while North Mara performed in line with its expectations. All three mines are based in Tanzania.
The group does expect production to improve in the fourth quarter, but its full-year production will come in broadly flat on the 718,851 ounces it delivered in 2014, below its previous guidance for full-year production to hit 750,000-800,000 ounces.
Shares in speciality pharmaceuticals company BTG were hit after it said it anticipates it will deliver full year revenue in the lower half of its guidance range, as interest in its varicose veins treatment Varithena has "not yet translated into sales growth."
However, the company reiterated its expectations of double-digit revenue growth for the year. BTG is guiding for revenue of between GBP410 million and GBP440 million for the year to end-March 2016. The company posted revenue of GBP367.8 million for the year to end-March 2015. BTG traded down 13%.
In the AIM All-Share index, Stanley Gibbons Group traded down 26%. The rare stamp and collectibles retailer issued a profit warning for the first half of its financial year, saying that gross margin and profit are expected to be substantially below the first half of the previous year, which will result in it missing market forecasts for the full year.
It said that while it completed some high value sales in September, the overall revenue for the six months ended September 30 was only at a similar level to the first half of the prior year.
Nostra Terra Oil And Gas, up 20%, and Independent Resources, up 15%, were the two of the best performers in the index after the pair's joint venture agreed to acquire a producing asset in Egypt.
The 50:50 joint venture between the two has reached an agreement with TransGlobe Energy Corp to acquire a 50% stake in the East Ghazalat concession in Egypt for USD3.5 million.
The project currently produces around 880 barrels of oil per day, based on production levels from June 2015, or 440 bopd net to the joint venture. The 2P reserves attributable to the asset at June 30 were estimated at 1.0 million barrels of oil.
Still ahead in the economic calendar, US trade balances are at 1330 BST and the Redbook index at 1355 BST. After the close of European equity markets European Central Bank President Mario Draghi will be speaking in Frankfurt at 1800 BST.
By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1
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