LONDON (Alliance News) - Stocks in London opened lower on Tuesday, with shares in BT Group under some selling pressure after Ofcom said it will proceed with requiring the legal separation of BT Group from its Openreach network infrastructure arm.
The UK media and telecoms regulator stopped short of calling for a structural separation of Openreach from BT and opted instead for a legal separation, meaning a separate board of directors will be formed.
The regulator said on Tuesday that creating a more independent Openreach will help it achieve the goal of improving broadband and telephone services for people in the UK.
Ofcom said BT had failed to offer acceptable remedies to the watchdog's competition concerns. It said it was "disappointed" BT "has not yet come forward with proposals that meet our competition concerns", adding that while "some progress" had been made on this front, "this has not been enough".
BT Group traded down 0.8%. Competitors Sky and TalkTalk Telecom both were up 1.2%
The FTSE 100 was down 0.4%, or 24.85 points, at 6,774.62, held back by miners which dominated the biggest fallers. The FTSE 250 recovered from early weakness to trade up 0.1% at 17,533.47, and the AIM All-Share was slightly lower at 821.56 points.
The BATS UK 100 was down 0.2% at 11,468.11, the BATS 250 was up 0.1% at 15,915.44, and the BATS Small Companies was flat at 10,975.67.
In Europe, the CAC 40 in Paris was down 0.3% and the DAX 30 in Frankfurt was down 0.4%.
In Asia, the Japanese Nikkei 225 index closed down 0.3%, the Shanghai Composite ended up 0.2% and the Hang Seng in Hong Kong closed down 0.3%.
Elsewhere in UK corporate news, SSP Group reported growth in profit in its recently-ended financial year thanks to good growth in air passenger travel and said its current financial year has started in line with expectations.
SSP, which operates food and drink outlets at airports and train stations, said pretax profit in the year ended September 30 grew to GBP105.6 million from GBP76.8 million the year before, as revenue rose to GBP1.99 billion from GBP1.83 billion and like-for-like sales increased by 3.0%.
SSP said sales growth was driven by increased air passenger travel, retailing initiatives it implemented and higher contract openings.
The stock was the best performer in the FTSE 250, up 5.2%.
Cranswick was another strong mi-cap performer, up 3.6%. The pork and poultry producer reported 38% growth in profit in the first half of its financial year, thanks to higher revenue from both its pork and poultry products, and said it is well-positioned to meet expectations for the full year.
Cranswick said it achieved a strong contribution from the Crown Chicken business, which it bought in April, while volume growth was driven by new contract wins and a greater number of pigs being processed through its two primary processing facilities.
The group will pay an interim dividend of 13.1 pence, up from 11.6p the year before.
Housebuilder and regeneration company Countryside Properties said the housing market had been more challenging at the higher price points, but said its pretax profit still almost tripled in its financial year.
Countryside, which listed in London in February, said its current trading was robust, with both sales rates and values above year-end figures at September 30. The group said the markets in which it operates have recovered following the European Union referendum in June, and reservations remain robust.
The group said it is on track to deliver against its medium-term targets of over 3,600 completions per year, an adjusted operating margin of over 17% and an improvement in return on capital employed in excess of 28%.
The stock was up 2.4% in early trade.
In the economic calendar, UK net lending to individuals, consumer credit and mortgage approvals are at 0930 GMT, and the German consumer price index is at 1300 GMT. US personal consumption expenditure prices are at 1330 GMT and US consumer confidence at 1500 GMT.
By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1
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