(Alliance News) - Share prices in London opened lower on Wednesday amid trepidation ahead of an economic symposium hosted by the US Federal Reserve, while Provident Financial rose after saying it had performed better than it had expected at the start of lockdown.
The Jackson Hole Economic Policy Symposium gets underway online on Thursday, with investors awaiting a key speech by Fed Chair Jerome Powell.
"Trading is expected to remain muted as investors wait patiently for this week's highlight - the virtual Jackson Hole central bankers' summit and more specifically Federal Reserve Jerome Powell's keynote speech, tomorrow, the first day of the symposium. Investors are waiting anxiously for any hints over the direction of monetary policy," said City Index analyst Fiona Cincotta.
In London, the blue-chip FTSE 100 index was down 31.85 points, or 0.5%, at 6,005.16. The mid-cap FTSE 250 index was down 21.24 points, or 0.1%, at 17,557.65. The AIM All-Share index was flat at 960.74.
The Cboe UK 100 index was down 0.6% at 597.69. The Cboe 250 was down 0.2% at 14,915.68. The Cboe Small Companies was down 0.1% at 9,461.65.
In mainland Europe, the CAC 40 index in Paris was down 0.4%, while the DAX 30 in Frankfurt was down 0.2%.
In the FTSE 100, Polymetal International was up 0.5% after the Russian gold miner reported a strong financial performance in the first half of the year amid a challenging global backdrop.
Gold miners have benefited from a sharp rise in the gold price which is up more than 25% so far in 2020. The precious metal was trading at USD1,915.28 an ounce Wednesday morning, slightly lower from USD1,918.27 late Tuesday.
For the six months to June 30, Polymetal's revenue was up 21% to USD1.14 billion from USD941 million last year and net earnings more than doubled to USD381 million from USD153 million.
Polymetal declared an interim dividend of USD0.40, twice as high as USD0.20 paid out last year.
Looking ahead, Polymetal said it remains on track to meet 2020 production guidance of 1.5 million ounces of gold equivalent and kept its full-year all-in-sustaining cash cost guidance in a range between USD850 to USD900 per ounce.
Fellow gold miner Fresnillo was up 0.7%.
In the FTSE 250, Provident Financial was the best performer, up 12%, despite the subprime lender scrapping its interim dividend.
For the six months ended June 30, Provident Financial swung to a pretax loss of GBP28 million from a profit of GBP43.1 million a year prior. This was as revenue fell 11% to GBP445.6 million from GBP501.5 million.
The Bradford, England-based company blamed the swing to loss on lower revenue and higher impairment charges of GBP240.3 million, from GBP165.9 million a year before, due to the Covid-19 pandemic. However, it said its performance was better than its expectations at the start of the lockdown in March.
No interim dividend was declared, compared to 9.0p paid for the first half of 2020, as Provident said it needs to preserve capital and ensure financial stability. However, it said it intends to resume dividend payments to shareholders as soon as financial conditions normalise.
Looking ahead, the doorstep lender noted that since the end of June, there were some encouraging signs of increased activity levels in its markets, with improving customer demand and spending trends evident.
"We believe there remain significant opportunities for a well-funded and well-capitalised non-standard lender to grow in the aftermath of the Covid-crisis given a likely increase in the number of available customers along with a reduction in competition," said Shore Capital.
Inchcape was up 5.0% after JPMorgan raised the car dealer to Overweight from Neutral.
WH Smith was up 4.0% after Goldman Sachs started coverage on the books and stationery retailer with a Buy rating.
The pound was quoted at USD1.3143 Wednesday morning, up from USD1.3123 at the London equities close Tuesday.
The euro stood at USD1.1810 Wednesday morning, flat from USD1.1818 at the European equities close Tuesday. Against the yen, the dollar was trading at JPY106.37, lower than JPY106.50.
Brent oil was quoted at USD45.88 a barrel Wednesday morning, flat from USD45.83 at the London equities close Tuesday.
The Japanese Nikkei 225 index ended flat. In China, the Shanghai Composite closed down 1.3%, while the Hang Seng index in Hong Kong is down 0.1%.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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