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(Alliance News) - The FTSE 100 ended flat on Tuesday as investors continue to digest the recent ratcheting up of tensions between the US and Iran.
In London, grocers ended among the top blue-chip performers while Standard Life Aberdeen was towards the rear, and in forex, the dollar gained following a strong report from the Institute for Supply Management.
The FTSE 100 index closed just 1.49 points lower at 7,573.85. The FTSE 250 ended up 72.15 points, or 0.3%, at 21,832.68, and the AIM All-Share closed down 2.75 points, or 0.2%, at 957.93.
The Cboe UK 100 ended up 0.1% at 12,827.81, the Cboe UK 250 closed up 0.1% at 19,730.60, and the Cboe Small Companies ended up 0.5% at 12,369.13.
"The FTSE was sticking close to the flat line across Tuesday's session as investors continued digesting threats from Iran whilst also looking ahead towards the signing of the US–China phase one trade deal next week," said Fiona Cincotta at City Index.
"As the perceived prospect of a war between the US and Iran recedes, oil continues to pare recent gains and the safe haven trade is starting to look tired," she added. "With no fresh moves from either Iran or the US investors are trying to move cautiously forward."
Brent surged above USD70 a barrel early Monday amid the fallout from the assassination of Qasem Soleimani, one of the most influential people in Iran's government. It has since fallen back slightly, to be quoted at USD68.02 a barrel at the London equities close Tuesday from USD68.94 late Monday.
This saw London-listed oil majors, such as BP and Royal Dutch Shell, end Tuesday's session in the red. BP closed down 1.1%, while Shell 'A' shares slipped 0.8% and 'B' shares 0.6%.
Gold, however, firmed amid Tuesday's cautious mood. The safe haven asset was quoted at USD1,568.77 an ounce at the London equities close Tuesday against USD1,562.34 at the close on Monday.
In European equities on Tuesday, the CAC 40 in Paris ended flat, while the DAX 30 in Frankfurt rose 0.8%.
Stocks in New York were mixed at the London equities close, with the Dow Jones down 0.1%, the S&P 500 index dipping 0.1%, but the Nasdaq Composite up 0.2%.
"A broad push higher in the US dollar has hurt EUR/USD in addition to GBP/USD. The robust US non-manufacturing figure helped the dollar extend earlier gains. The eurozone posted respectable economic reports this morning, but the strength of the US dollar was too much for the single currency," said David Madden at CMC Markets.
Activity in the US non-manufacturing sector continued to grow in December, and at a faster pace than the month before, the Institute for Supply Management showed on Tuesday.
The non-manufacturing purchasing managers' index registered 55.0 in December, up from 53.9 in November and remaining above the 50.0, which indicates expansion. Any reading below 50.0 signals contraction in a sector.
"The past relationship between the NMI and the overall economy indicates that the NMI for December corresponds to a 2.2% increase in real gross domestic product on an annualized basis," said Anthony Nieves, ISM chair.
The pound was quoted at USD1.3118 at the London equities close Tuesday, down compared to USD1.3165 at the close on Monday.
The euro was also lower against the dollar, standing at USD1.1138 at the European equities close Tuesday, against USD1.1187 at the same time on Monday.
This was despite the euro area reporting an acceleration in inflation for December, with the annual rate up to 1.3% after November's reading of 1.0%. Separately, Eurostat said retail sales grew 1.0% month-on-month in the euro area in November, bouncing back from a 0.3% decline the month before.
Against the yen, the dollar was trading at JPY108.59 compared to JPY108.37 late Monday.
In London, the FTSE 100 ended broadly flat, with supermarkets among the gainers and Standard Life Aberdeen towards the bottom of the index.
Online grocer Ocado ended as the top blue-chip performer on Tuesday, up 4.5% after Kantar revealed the firm saw its sales grow the fastest in UK grocery sector in the 12 weeks to December 29.
The FTSE 100-listed firm saw sales jump 13% year-on-year in the period to GBP389 million from GBP345 million. Its market share nudged up to 1.3% in the 12 weeks from 1.2% last year.
The data came as Kantar reported UK supermarket sales overall for the period rose to GBP29.35 billion from GBP29.30 billion, representing 0.2% year-on-year growth, which the slowest rise in four years.
Among other London-listed grocers, Tesco saw its market share fall to 27.4% from 28.4%, still the largest in the UK grocery market, however. Sales were down 1.5% to GBP8.03 billion from GBP8.15 billion.
J Sainsbury's sales fall was more modest, declining 0.7% year-on-year to GBP4.69 billion from GBP4.73 billion with market share at 16.0% compared to 16.1%. Sainsbury's shares closed up 2.9%, and Tesco up 0.2%.
Wm Morrison Supermarkets, meanwhile, closed up 1.7%. The Bradford, Yorkshire-based firm saw its market share slip to 10.3% from 10.6%, with sales falling by 2.9% to GBP3.01 billion from GBP3.11 billion last year, said Kantar.
Additionally, the FTSE 100 constituent on Tuesday said like-for-like sales, excluding fuel, were down 1.7% year-on-year in the 22 weeks to January 5. Total sales were down 2.9% year-on-year, and declined 1.8% when not including fuel sales.
Despite the slip in sales, the firm reiterated its full-year guidance, expecting pretax profit before exceptional costs to be in line with analyst forecasts. Morrisons ends its financial year on February 2.
In the red was Standard Life Aberdeen, finishing 3.5% lower after Exane BNP cut the asset manager to Underperform from Neutral. In addition, JPMorgan downgraded the stock to Neutral from Overweight.
In the FTSE 250, Premier Oil rose 16% on news it is to buy two North Sea assets from BP, and has also built up its stake in a soon-to-be-producing field.
Premier is buying the Andrew Area and Shearwater assets from oil major BP for USD625 million. Andrew Area includes five fields producing 18,000 barrels of oil equivalent per day, and Shearwater 25 million barrels of oil equivalent of reserves. Premier is taking 50% to 100% stakes in the five Andrew Area fields, as well as 28% of the Shearwater assets.
The acquisition will be funded by a USD500 milion equity raise, and, if needed, a USD300 million bridge facility. Premier expects the equity raise to include both a share placing and a rights issue, with the details to be confirmed during the first quarter of 2020.
The company also has taken 25% more of Tolmount off Dana Petroleum for USD191 million, and a potential USD55 million more. Tolmount, a gas field, is expected to come onstream at the end of 2020.
Aston Martin Lagonda shares hit a speed bump as the luxury car maker issued another profit warning.
Challenging trading conditions disclosed in November continued through the peak delivery period of December, Aston Martin said, resulting in lower sales, higher selling costs and lower margins.
Aston Martin now sees 2019 adjusted earnings before interest, taxes, depreciation and amortisation to come in at a range between GBP130 million and GBP140 million and margin between 12.5% to 13.5%. In 2018, adjusted Ebitda came in at GBP247 million.
In July, Aston Martin cut its annual guidance due to a worsening trading environment. It predicted 2019 wholesale sales at 6,300 to 6,500 vehicles and adjusted earnings before interest, taxes, depreciation, and amortisation margin of around 20%.
The stock closed down 16% on Tuesday, meaning its shares have shed 64% over the past 52 weeks.
Finablr slid 5.8% as its travel money services unit Travelex continues to wrestle with a cyber attack.
According to PA, it is understood criminals are demanding cash – speculated to be some USD3 million – from Travelex to give the firm access to its computer systems after they attacked the sites with the infamous Sodinokibi ransomware on December 31.
They are reportedly threatening to release 5GB of customers' personal data – including social security numbers, dates of birth and payment card information – into the public domain unless the company pays up. Travelex first revealed the New Year's Eve attack on January 2, when it sought to assure that no customer data had yet been compromised as a result of the breach.
The UK corporate calendar on Wednesday has third quarter results from grocer J Sainsbury and trading statements from baker Greggs and Topps Tiles.
In the economic calendar on Wednesday there are UK Halifax house prices at 0830 GMT followed but eurozone consumer confidence at 1000 GMT and Irish retail sales at 1100 GMT. In the US there is ADP employment change due out at 1315 GMT, a precursor to Friday's nonfarm payrolls.
By Lucy Heming; lucyheming@alliancenews.com
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