LONDON (Alliance News) - Stocks in London closed lower Thursday after the pound rose following the announcement that UK retail sales rebounded in April with a 1.6% rise.The FTSE 100 index - with a large number of companies which earn their revenue from overseas - closed down 0.9%, or 71.70 points, at 7,716.74 Thursday. The mid-cap FTSE 250 index closed down 0.1% at 20,989.49. The AIM All-Share index closed down 0.1% at 1,087.07.The Cboe UK 100 closed down 0.6% at 13,124.82, the Cboe UK 250 closed marginally down at 19,247.46, and the Cboe UK Small Companies closed down 0.7% at 12,754.45.The pound was up quoted at USD1.3381 at the London equities close, compared to USD1.3349 at the same time on Wednesday.Data from the Office for National Statistics showed UK retail sales grew at a faster than expected pace in April after declining in March. Retail sales volume - including auto fuel - expanded 1.6% month-on-month, in contrast to a 1.1% fall in March. This was ahead of the 0.9% growth forecasted by economists. Excluding auto fuel, retail sales volume increased 1.3%, reversing a 0.5% drop in March. Economists had expected a 0.5% rise.On a yearly basis, retail sales including auto fuel, rose 1.4% in April after expanding 1.3% in March. Excluding auto fuel, sales volume advanced 1.5% versus 1.3% rise a month ago."Following March's weather-impacted decline, the pace of retail sales picked up strongly last month easing concerns over the health of the UK consumer," Lloyds Bank UK Economist Nikesh Sawjani said. "To us, the arguments for a firm recovery in retail sales last month was compelling", Sawjani added. "The marked turnaround in the weather alongside the continued feed-through from improved household real incomes supported a sizeable rise in retail sales activity. The impact of the former was evident in sales at clothing and footwear stores and food stores, while the overall improvement in purchasing power was reflected in rises in all but one of the main categories of retail spending."Rooted to the bottom of the FTSE 100 index,
Mediclinic International closed down 4.3%. This was after the private hospital group swung to a loss in its recently ended financial year due to high exceptional costs.Revenue for the year ended March rose 4% to GBP2.87 billion, up 3% at constant currency. The company sunk to a pretax loss of GBP479 million from a GBP307 million profit the year prior.Profit performance was hurt by impairments associated with changes to "the market and regulatory environment" in Switzerland as well as its holding in
Spire Healthcare Group. The changes in Switzerland resulted in a combined GBP644 million impairment of property and intangibles. Impairments associated with its 29.9% stake in Spire amounted to GBP109 million. This was after the FTSE 250-listed Spire saw its own pretax profit tumble to GBP22.7 million from GBP73.2 million during 2017.Spire closed one of the worst performer on the mid cap index, down 3.6%. This was after it reiterated its annual guidance despite expecting first half earnings to be below last year, with an improvement seen in the second half.Market conditions over the start of the year remained challenging, the private healthcare operator said. However, revenue recorded to the end of April has been in line with expectations, with "good" self-pay growth, PMI revenue slightly lower, and a decline in NHS revenue due to from volume reductions.At the top of the FTSE 100,
Intertek Group closed up 3.0%. This was after the quality-assurance and safety testing firm reported over 4% growth in constant-currency revenue for the first four months of 2018, driven by organic growth and the benefits from acquisitions.For the four months ended April, reported revenue fell 2.5% GBP861.2 million from GBP883.5 million the year before. At constant currency rates, however, revenue rose 4.4% "driven by a good organic growth of 4.0% at constant rates and by the contribution of the acquisitions we made recently in attractive growth and margin sectors," Chief Executive Officer Andre Lacroix said.Intertek expects revenue growth on a constant currency basis for 2018.The second best performer was
Paddy Power Betfair, up 2.2%. This was after it agreed to combine its US business - Betfair US - with US fantasy sports operator FanDuel. Under the terms of the deal - announced after the market close on Wednesday - the bookmaker will also pay USD158 million in cash as part of the deal. After the transaction the group will have a 61% stake in FanDuel.At the bottom of the FTSE 250 was
Paragon Banking Group, closing down 7.7%. This was after the bank said it was continuing its major restructuring programme to change its business model to a more diversified bank from a buy-to-let lender. This was amid a profit increase of 11% for the year ended March to GBP77.2 million from GBP69.4 million.Second worst was brick maker
Ibstock, down 5.0%. This was after its reported a slower than expected start to the year due to an extended winter season in the UK. US activity was also affected by weather conditions in the first quarter to the end of March, however volumes have returned to traditional seasonal levels."Market fundamentals in the UK remain robust with the demand for new housing, in particular, continuing to underpin activity levels in both our clay and concrete businesses. At this early stage in the US building season we anticipate a stable performance from our Glen Gery business. The board expects another year of progress for the group, albeit with performance expected to be weighted towards the second half, driven predominantly by new volumes from its major projects in bricks and roof tiles," Ibstock said in a statement.In the FTSE 250,
Electrocomponents closed at the top of the index up 16%. This was after the engineer hiked its dividend Thursday after reporting its profit and revenue jumped significantly as it looks to make further progress.For the year ended March, pretax profit widened 33% to GBP168.6 million from GBP127.1 million the year prior. This was after revenue grew 13% to GBP1.71 billion from GBP1.51 billion the year before."2018 has been a year of strong progress and significant growth in revenue, profitability and earnings," Electrocomponents Chief Executive Officer Lindsley Ruth said. "Our Performance Improvement Plan has delivered a major step forward in our quest to become first choice for customers, suppliers and employees but the opportunity for further growth and improvement still remains significant.""Today we are launching a new phase of the improvement programme to ensure we fully capitalise on this exciting opportunity", Ruth added.As part of this, Electrocomponents plans to continue the process of simplifying and scaling the business. The next phase is expected to generate GBP12 million in annualised savings by financial 2021, with GBP4.0 million targeted in financial 2019.Recycling firm
Renewi was the second best performer, closing up 6.2%. In its first full year of trading following its creation on the merger of Shanks Group and Van Gansewinkel Group in February 2017, pro forma revenue increased 8% to GBP1.56 billion form GBP1.45 billion.Reported pretax loss narrowed to GBP50.0 million from GBP61.4 million year-on-year. Whilst adjusted pretax profit doubled to GBP51.5 million from GBP25.7 million."We have made good progress in our first full year as Renewi. Underlying pretax profit doubled, coming in slightly ahead of our upgraded expectations, and our cash performance was strong," Chief Executive Officer Peter Dilnot said.Food ingredients company
Tate & Lyle, ended up 8.8%. This was afters its full year profit increased by almost a quarter despite revenue dipping modestly.For the year ended March, pretax profit widened 23% to GBP286.0 million from GBP233.0 million the year prior. Revenue, however, declined 2.0% to GBP2.71 billion from GBP2.75 billion. Tate & Lyle increased its full year dividend to 28.7 pence per share from 28.0p the prior year.US activity was also hit by weather in the first quarter of 2018, however volumes have returned in line with traditional seasonal levels.In mainland Europe, in Paris the CAC 40 ended down 0.3%, while the DAX 30 in Frankfurt ended down 0.9%. The euro was a touch lower at USD1.1728 at the European equities close, against USD1.1703 the prior day.In France, data from Insee revealed manufacturing sentiment remained unchanged in May despite expectations of a fall. The manufacturing sentiment index held steady at 109 in May. The score was forecast to fall to 108.In Germany, data from Destatis showed the economy expanded at a slower pace as initially estimated in the first quarter on weak trade.Gross domestic product grew 0.3% sequentially, slower than the 0.6% expansion seen in the previous quarter. This was the weakest growth in more than a year and matched the provisional estimate published on May 15.The expenditure-side breakdown of GDP showed positive contribution from domestic demand. Gross fixed capital formation in machinery and equipment rose 1.2% and that in construction gained 2.1% sequentially.Also, household final consumption expenditure increased slightly by 0.4%. However, government final consumption expenditure decreased for the first time in almost five years, by 0.5%.On external trade, total exports of goods and services dropped 1.0% and imports decreased 1.1%. As a result, the balance of exports and imports had a downward effect of 0.1 of a percentage point on economic growth.On a yearly basis, calendar-adjusted GDP climbed 2.3% after expanding 2.9% in the fourth quarter. Similarly, price-adjusted GDP growth eased to 1.6% from 2.3% a quarter ago. The annual rates matched flash estimate.Stocks in New York were lower at the London equities close. The DJIA was down 0.7%, the S&P 500 index down 0.5% and the Nasdaq Composite down 0.4%.In the economic events calendar on Friday, Germany will release Ifo Business Climate Index data at 0900 BST, UK preliminary first quarter gross domestic product figures at 0930 BST and in the US the advance report on durable goods and University of Michigan consumer survey are due at 1330 BST and 1400 BST. In the UK corporate calendar on Friday, full year results from utility firm
SSE, security firm
Westminster Group and water and waste services provider
Pennon Group. Trading statements are due from engineering firm
Spectris and power generation firm
ContourGlobal.
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