LONDON (Alliance News) - London stocks slid on Thursday, with Paddy Power Betfair and Lloyds Banking dipping in the FTSE 100 along with a fall in oil prices, which put BP shares under pressure. A consensus-beating set of first-quarter results from Royal Dutch Shell helped London's largest oil major avoid a Brent price-driven slip into the red, however. The FTSE 250, meanwhile, was kept lower by tumble for Metro Bank as its first-quarter profit halved. The FTSE 100 index closed down 33.95 points, or 0.5%, at 7,351.31. The FTSE 250 ended down 127.08 points, or 0.6%, at 19,686.66, and the AIM All-Share closed down 1.85 points, or 0.2%, at 968.29.The Cboe UK 100 ended down 0.5% at 12,465.04, the Cboe UK 250 closed down 0.6% at 17,657.08, and the Cboe Small Companies ended up 0.2% at 11,749.43.Explaining the FTSE 100's fall on Thursday, Spreadex analyst Connor Campbell said: "Though Brent Crude's 2.4% slide - coming after US crude stockpiles rose to their highest levels since September 2017 - failed to shake Shell, thanks to its better than forecasts first quarter profit, BP slipped."Brent oil was quoted at USD70.18 a barrel at the London equities close Thursday from USD71.40 late Wednesday.BP shares closed down 1.2%, while Royal Dutch Shell 'A' shares gained 1.6% and 'B' shares 1.7%. Oil major Royal Dutch Shell on Thursday reported a decline in quarterly earnings, but significant growth in Integrated Gas helped it beat the market's expectations. Shell increased current cost of supply earnings, its preferred profit metric, in the Integrated Gas segment by 17% to USD2.80 billion for the three months to March, on the back of higher liquefied natural gas and gas prices, helping offset lower production and sales volumes.Consensus had been for Integrated Gas - primarily Shell's BG Group acquisition - CCS earnings of USD2.07 billion. On a group basis CCS earnings excluding items declined by 2% year-on-year to USD5.43 billion, compared to analyst consensus of USD4.54 billion. CCS earnings attributable to shareholders excluding items also was down by 2%, to USD5.30 billion.Total first quarter production decreased by 2% to 3.75 million barrels of oil equivalent per day year-on-year.Despite Brent's slip, London's blue-chip index managed to "cap its losses", said Spreadex, "in part thanks to cable pulling back"."For whatever reason, the pound wasn't very taken with the Bank of England revising higher its UK growth forecasts for the year," Campbell observed. The Bank of England on Thursday decided to keep interest rates on hold, as Governor Mark Carney warned that rates may need to rise faster than the market expects in the case of a smooth Brexit and a UK growing economy.The nine-strong Monetary Policy Committee all voted to keep Bank Rate at 0.75%, while also unanimously voting to keep corporate bond purchases at up to GBP10 billion and purchased assets at GBP435 billion.At a press conference following the decision, Carney said more frequent rate increases than the market currently expects may be required if the economy evolves in line with the bank's forecasts and the UK leaves the EU with a deal, lifting Brexit uncertainty.Under this scenario, there are currently insufficient hikes priced in for the MPC to meet its remit, he said. The BoE also boosted its forecast for UK economic growth in 2019, but cut its inflation outlook to reflect lower retail energy prices.The BoE, in its quarterly Inflation Report, now sees the UK economy growing 1.5% in 2019, having been revised down to 1.2% in February's inflation report. Inflation, meanwhile, is seen below target in 2019 at 1.6%.The pound was quoted at USD1.3034 at the London equities close Thursday following the BoE, down from USD1.3090 at the close on Wednesday.In UK data on Thursday, construction output rose for the first time since January, buoyed by domestic housebuilding.The seasonally adjusted IHS Markit/CIPS purchasing managers' index increased to 50.5 in April from 49.7 in March, beating consensus estimates of 50.3. The score went back above the line of 50 that separates expansion from contraction.IHS Markit said the reading pointed to a modest expansion of overall construction output in April, which contrasted with the declines seen in each of the previous two months.The eurozone was greeted by some less cheery data, however, as IHS Markit showed the bloc's manufacturing sector activity remained in contraction territory in April.The Markit eurozone manufacturing purchasing managers' index increased to 47.9 in April from 47.5 in March. Despite the improvement, the PMI score remained below the no-change mark of 50, indicating a third consecutive month of decline in manufacturing activity.The euro stood at USD1.1182 at the European equities close Thursday, down against USD1.1245 at the same time on Wednesday.In European equities on Thursday, the CAC 40 in Paris ended down 0.9%, while the DAX 30 in Frankfurt ended flat.Stocks in New York were mostly lower at the London equities close, with the Dow Jones down 0.4%, the S&P 500 index down 0.2%, and the Nasdaq Composite flat.Back in London, Lloyds Banking slipped 1.4% as it reported a flat first-quarter profit and a dip in net interest income. In the first quarter, Lloyds's pretax profit was stable year-on-year at GBP1.60 billion, but net interest income decreased 3.8% to GBP3.08 billion from GBP3.17 billion.Lloyds' banking net interest margin in the period was 2.91%, down from 2.93% in the first quarter last year and down from 2.92% in the previous quarter.At the bottom of the FTSE 100 was Paddy Power Betfair, shedding 5.1% as it reported a good first quarter despite "customer friendly sports results" in the UK. In the three months to March 31, the bookmaker reported total revenue of GBP478 million, 17% higher than the GBP408 million reported the year before. However, the group said its UK online sports betting business was affected by "unfavourable results" in sporting events in the UK and Ireland. Gold miner Fresnillo ended down 1.3%, tracking the price of the previous metal lower. The safe haven asset was quoted at USD1,270.28 an ounce at the London equities close Thursday against USD1,281.80 at the close on Wednesday."Gold is in the red as the nudge higher in the US dollar hurt the metal... Gold is close to last month's low, and should it break below the USD1,266 area, it might pave the way for the USD1,250 region to be tested," said David Madden at CMC Markets. At the top of the index finished Smith & Nephew, up 3.0% after the medical devices maker said revenue growth for 2019 is set to be towards the upper end of guidance.On a reported basis, the medical device maker's revenue was flat at USD1.20 billion for the three months to March 31 but revenue was up 4.4% on an underlying basis. Given the recent underlying performance, the medical device maker has updated its guidance and is now "increasingly confident" that its underlying revenue growth for 2019 will be in the upper half of its 2.5% to 3.5% guidance range. Weighing on the FTSE 250 was a 14% drop for Metro Bank after it reported disappointing first-quarter figures after the market close on Wednesday. The bank posted a pretax profit of GBP4.3 million for the three months to March 31, halving its GBP8.6 million profit in the same quarter of 2018. Total revenue was GBP107.5 million, up 17% from GBP91.8 million, including GBP83.8 million of net interest income versus GBP75.0 million the year before.Metro Bank Chief Executive Craig Donaldson said: "Adverse sentiment following January's update impacted deposit growth in the quarter, with a small number of large commercial and partnership customers making withdrawals, but we are pleased to see a return to net inflows in April."Total deposits in the first three months of the year were down 3.6% quarter-on-quarter, causing net deposits per store per month to drop 38% to GBP2.9 million from GBP4.7 million growth in the fourth quarter of 2018. Shares in the challenger bank have dropped 61% since 2019 began. In the UK corporate calendar on Friday, there are first-quarter results from Asia-focused lender HSBC at 0500 BST. Later in the morning are first-quarter figures from packaging firm Smurfit Kappa, InterContinental Hotels Group and wound dressing maker ConvaTec. In Friday's economic calendar, eurozone consumer price inflation readings are due at 1000 BST while in the US, nonfarm payrolls along with the unemployment rate and average hourly earnings are all at 1330 BST. Then, at 1445 BT, is the Markit US services PMI.
14 Mar 2016 15:56
