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(Alliance News) - London stocks were lower on Tuesday morning, with some traders remaining away from their desks ahead of the New Year's Day holiday, while others were cashing out of a flagging Santa Rally.
The FTSE 100 index was down 43.63 points, or 0.6%, at 7,543.42 early Tuesday. The mid-cap FTSE 250 index was 33.44 points lower, or 0.2%, at 21,902.82, and the AIM All-Share index was flat at 958.11.
The retreat follows a strong Christmas week for London shares, with the FTSE 250 index of mid-caps reaching a record closing high, breaching the 22,000 mark for the first time.
The Cboe UK 100 index was down 0.6% at 12,783.36. The Cboe 250 was 0.2% lower at 19,815.78, and the Cboe Small Companies flat at 12,247.11.
The London Stock Exchange will close early at 1230 GMT for New Year's Eve. It will re-open on Thursday for a full session.
Sterling was quoted at USD1.3130 early Tuesday, flat with USD1.3136 at the London equities close on Monday.
In other currencies, the euro was trading at USD1.1205 early Tuesday, soft on USD1.1216 late Monday. Against the yen, the dollar was at JPY108.63, down slightly from JPY108.83.
In mainland Europe, the CAC 40 in Paris was down 0.4%. Financial markets in France will close early on Tuesday, while German markets are completely closed for New Year's Eve. Italy and Switzerland also are closed all day.
In Asia on Tuesday, financial markets were closed in Japan. In China, the Shanghai Composite ended up 0.3%, while the Hang Seng index in Hong Kong closed down 0.5%.
Tokyo will remain shut until Monday, while the Shanghai and Hong Kong markets are closed on New Year's Day but reopen on Thursday.
Back in London, HSBC Holdings started the day 0.6% lower after the Financial Times reported that the bank is planning to expand its exchange traded fund range in 2020 in order to revitalise its underperforming asset management business.
Nicholas Moreau, who was appointed chief executive of HSBC's asset management division in August, has devised a series of initiatives aimed at reinvigorating growth at a time when the London-listed bank is aggressively cutting costs, the FT said.
In the first half of 2020, HSBC will launch eight ETF's employing environmental, social and governance metrics to tap into rising investor demand for ESG-focused strategies.
HSBC also plans to develop a fixed income ETF platform in 2020 and to launch a range of precious metals tracker funds later in the year, the FT noted.
On AIM, Redx Pharma surged 31% in early trade to 8.68 pence. The company reported it is in "active" discussions with Samuel Waksal and associates, which could lead to a possible cash offer for the company.
In the meantime, the drug discovery and development company called on its shareholders to vote in favour of the conversion of a GBP2.5 million loan into shares. A general meeting will be held on January 21.
"We believe that this short-term funding solution will allow us time to secure the necessary longer-term funding that will enable us to advance our innovative pipeline of novel precision medicines for cancer and fibrosis," explained Chair Iain Ross.
The loan agreement was signed back in June with Moulton Goodies Ltd, Redx's largest shareholder which has over 18% stake, for a fixed rate secured loan note facility of up to GBP2.5 million. The loan is repayable in full on Tuesday. However, Moulton has requested that Redx capitalise the whole of the loan, including all unpaid interest, into new shares.
The capitalisation price pursuant to the terms of the loan notes is 5.25p per share, which will result in the issue of 52.0 million new shares to Moulton.
In the red early Tuesday was KCR Residential REIT, down 9.3%, after saying that it has been unable to publish its results for the year to the end of June until the end of 2019. The company explained that it is in the process of finalising the audit and the results will be announced "as soon as possible".
The delay is procedural having been caused by time-delays during the course of the audit which started later than expected following the closing of the corporate transaction with Torchlight Fund, the company said.
KCR Residential REIT shares will be suspended on Thursday.
Gold was quoted at USD1,524.30 early Tuesday, up from USD1,515.03 at the London equities close on Monday.
Brent oil was trading at USD66.48 early Tuesday, firm on USD66.14 at the London equities close on Monday.
The economic events calendar on Tuesday has only US data. The Johnson Redbook retail sales index is at 1355 GMT, with the monthly house price index at 1400 GMT and the US consumer confidence index at 1500 GMT.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
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