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(Alliance News) - Equities in London struggled to get off the ground on Friday, failing to shake off expectations of an expected plunge in EU gross domestic product and the imposing of more local lockdowns in the UK.
The FTSE 100 index was 1.42 points lower at 5,988.57 early Friday. The mid-cap FTSE 250 index was 0.4% higher at 17,092.43, and the AIM All-Share was up 0.5% at 886.28.
The Cboe UK 100 index was up 0.2% at 597.19. The Cboe 250 was flat at 14,446.98 and the Cboe Small Companies was up 0.1% at 9,100.65.
Markets in mainland Europe were showing more decision. The CAC 40 in Paris was up 0.2%, while the DAX 30 in Frankfurt was 0.3% higher early Friday.
Stocks in the US ended mixed, with the Dow Jones Industrial Average falling after data showed the US economy contracted by a massive 33% on an annual basis in the second quarter due to lockdowns imposed to stop the spread of the coronavirus.
The tech-heavy Nasdaq Composite ended higher, ahead of what was a bumper evening of earnings after the final bell in the US. Apple, Amazon.com and Facebook all saw earnings climb, but Google-owner Alphabet posted its first-ever revenue fall.
The corporate calendar in the US has second-quarter earnings from oil majors Chevron and Exxon Mobil. Car maker Fiat Chrysler also reports second-quarter numbers.
Against the yen, the dollar was trading at JPY104.32, down from JPY105.08.
In Asia on Thursday, the Japanese Nikkei 225 index closed down 2.8%. In China, the Shanghai Composite ended up 0.7% ,while the Hang Seng index in Hong Kong is down 0.2%.
In the UK, Health Secretary Matt Hancock announced on Thursday evening that "immediate action" was needed across Greater Manchester and parts of east Lancashire and West Yorkshire to keep people safe. The stricter lockdown measures, announced via Hancock's Twitter feed at around 9pm and later posted online, mean members of different households are not be able to meet indoors.
The pound was quoted at USD1.3136, improved from USD1.3036 at the London equities close. Sterling is trading at around its highest levels versus the greenback since March.
The euro stood at USD1.1892 early Friday in London, up from USD1.1781 on Thursday's equities close in Europe.
The economic events calendar on Friday has eurozone inflation and gross domestic product readings at 1000 BST.
"The first estimate of Eurozone Q2 GDP will show a very sharp contraction, but the question is by how much," analysts at Lloyds said.
"The ECB's June projections predicted a fall of 13.0% for the eurozone, while the consensus forecast is for a slightly smaller (but still massive) drop of 12.1%."
International Consolidated Airlines Group was bottom of the pile in the FTSE 100 early doors, down 4.6%
In a stacked update, IAG reported an unsurprising second-quarter loss, announced its chair succession plans, and confirmed a proposed EUR2.75 billion fundraise.
Before exceptional items, IAG swung to a pretax loss of EUR4.21 billion during the six months to June 30, a period when Covid-19 emptied skies and killed demand for travel. Revenue dropped 61% annually to EUR4.15 billion.
The BA-owner booked an exceptional charge of EUR2.14 billion during the half, related to "de-recognition of fuel", foreign currency hedges and a fleet impairment.
Earlier in July, IAG had said it was considering a capital raise, and on Friday it confirmed it plans to secure EUR2.75 billion from a pre-emptive subscription. Largest shareholder Qatar Airways, with a 25% stake, has backed IAG's plans to bolster its coffers.
In January 2021, Chair Antonio Vazquez will make way for Javier Ferran, currently an independent director at IAG. Vazquez reached nine years in office last January.
Testing specialist Intertek Group lost 2.0%. Its first half pretax profit fell by a third to GBP151.5 million. Revenue was down 7.8% annually to GBP1.33 billion.
Intertek held its interim payout at 34.2 pence a share.
British American Tobacco rose 1.8%, the blue-chip tobacco firm's revenue climbed 0.8% year-on-year in the first half to GBP12.27 billion. Profit from operations surged 16% to GBP5.10 billion and pretax profit climbed 19% to GBP4.59 billion.
BT climbed 0.9% early on Friday. First quarter revenue fell 7% to GBP5.26 billion, with pretax profit slumping 13% to GBP561 million.
The revenue fall was "primarily due to the impact of Covid-19, including reduced BT Sport revenue and a reduction in business activity in our enterprise units," BT said.
Covid-19 wreaked havoc on the sporting calendar, but in recent weeks and months football both in the UK and elsewhere has returned.
The telecommunications firm also offered annual guidance, expecting adjusted revenue to fall between 5% and 6% in financial 2021 and for adjusted earnings before interest, tax, depreciation and amortisation to be between GBP7.2 billion and GBP7.5 billion.
BT also said it has hired Rob Shuter, currently CEO of South Africa's MTN Group, as the new CEO of BT Enterprise, replacing Gerry McQuade.
London Stock Exchange Group climbed 0.8%. First-half results showed revenue rose 4% annually to GBP1.06 billion, though pretax profit edged lower to GBP362 million from GBP363 million.
"We are making good progress on the proposed transaction with Refinitiv, securing a number of regulatory approvals and engaging constructively with authorities on remaining approvals," said Chief Executive David Schwimmer.
The US Department of Justice closed its antitrust probe of LSEG's Refinitiv takeover. But the stock exchange operator also said it has "commenced exploratory discussions" which could result in it selling its interest in government bond exchange platform MTS or even the Borsa Italiana Group as a whole.
The news comes following the European Commission's Phase II review of the Refinitiv takeover.
"There can be no certainty that LSEG will decide to proceed with a transaction relating to either of these businesses," LSEG noted.
NatWest, fresh from its name change from Royal Bank of Scotland Group, posted a first half operating loss of GBP770 million, swinging from a GBP2.69 million profit a year ago. Its loss attributable to shareholders came in at GBP705 million, swinging wildly from a GBP2.05 billion profit a year ago.
The lender's shares were 1.1% lower. NatWest's impairment provision on June 30 totalled GBP6.1 billion, ratcheted up from GBP4.2 billion in March and GBP3.7 billion at the end of December.
"Our performance in the first half of the year has been significantly impacted by the challenges and uncertainty our economy continues to face as a result of Covid-19," Chief Executive Alison Rose said.
Pets At Home Group topped the FTSE 250, up 6.1% early on Friday. Total revenue in the quarter ended July 16 was down 1.0%, but the pet care firm saw like-for-like sales bounce toward the end of the quarter.
In the four weeks to June 19, like-for-like sales were up 15%, recovering from a 23% fall in the four weeks to March 27.
Gold changed hands at USD1,971.21 early Friday, up from USD1,941.55 an ounce at the London equities close on Thursday.
Polymetal and Fresnillo topped the blue-chip index, up 2.9% and 4.1%, respectively.
Brent oil fetched USD43.56 early Friday, improved from USD42.72 at the London equities close on Thursday.
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