(Alliance News) - The FTSE 100 ended in the red on Wednesday in the wake of a shambolic first US presidential debate between rivals Donald Trump and Joe Biden.
However, European stocks closed off their intraday lows as Wall Street rallied in early trade on some better-than-expected data and stimulus hopes.
The FTSE 100 index closed down 31.40 points, or 0.5%, at 5,866.10. The FTSE 250 ended up 141.64 points, or 0.8%, at 17,315.30, and the AIM All-Share closed up 3.08 points, or 0.3%, at 959.73.
The Cboe UK 100 ended down 0.5% at 584.06, the Cboe UK 250 closed up 0.8% at 14,658.60, and the Cboe Small Companies ended up 0.4% at 9,170.85.
In European equities on Wednesday, the CAC 40 in Paris ended down 0.6%, while the DAX 30 in Frankfurt ended down 0.5%.
In contrast to Europe, stocks in New York were higher at the London equities close, with the Dow Jones up 1.5%, the S&P 500 index up 1.2%, and the Nasdaq Composite up 1.3%.
"Wall Street opened in the green after US Treasury secretary Steve Mnuchin said there was a last shot at getting a new stimulus bill passed. That helped a bounce back from small overnight losses in futures markets following the first presidential debate," said Jasper Lawler, head of research at LCG.
Trump and Biden's first head-to-head meeting was a chaotic affair which turned almost immediately into a shouting match 35 days ahead of the most tense US election in recent memory.
The debate in Cleveland, Ohio, was as bad-tempered as had been feared, with Trump leading the way in yelling over his challenger and the Fox News moderator Chris Wallace alike.
At times, neither Biden nor Wallace could get a word in, as Trump loudly touted his economic record and went after Biden's son Hunter. At one point an exasperated Biden, who leads strongly in the polls, turned to Trump and said: "Will you shut up, man!"
The anger-filled event did nothing to calm fears around the country that the presidential election, taking place in the middle of an ongoing coronavirus pandemic, could end in chaos.
The debate sparked losses in Asia overnight and a lacklustre open in Europe, though Wall Street's upbeat open helped London's FTSE 100 rise off its lows in the afternoon.
Among the stocks tugging on London's blue-chip index was Royal Dutch Shell, 'A' and 'B' shares ending down 2.0% and 1.7% respectively.
The oil major said it plans to slash thousands of jobs as it looks to seal up to USD2.5 billion in annual cost savings by 2022 as the oil major grapples with tumbling demand.
The company said it expects third-quarter production in its Integrated Gas arm to be between 820,000 and 860,000 barrels of oil equivalent per day, at best a 10% annual decline. In its Upstream operations, output is tipped to land between 2.15 million boepd and 2.25 million, with the segment hit by the hurricane season in the US.
In addition, the oil major expects earnings to be hit by a post-tax impairment charge in the range of USD1.0 billion to USD1.5 billion for the third quarter.
Shell said it expects to cut 7,000 to 9,000 jobs by the end of 2022 following the plunge in demand. The "reduced organisational complexity" and other measures, Shell said, are expected to deliver sustainable annual cost savings of between USD2.0 to USD2.5 billion by 2022.
Brent oil was quoted at USD41.92 a barrel at the London equities close Wednesday, up from USD41.08 late Tuesday.
Gold was quoted at USD1,898.89 an ounce at the London equities close Wednesday against USD1,892.11 at the close on Tuesday.
FTSE 100 constituent Compass fell 3.2% after guiding to a sharp revenue drop for its 2020 financial year.
The contract caterer said revenue for its financial year ending Wednesday was down 19%, having fallen 44% in the third quarter and 36% in the fourth. The company said it saw some improvement in the fourth quarter as students began to return to schools and workers to offices.
However, it is reviewing its contract portfolio and currently estimates that, subject to audit, it will have to impair around GBP100 million of contract assets. Including these impairments, it expects to post a negative underlying operating margin of about 3% for the fourth quarter, improved from a 5.3% negative underlying operating margin in the third quarter. Before impairments, its operating margin was at breakeven in the fourth quarter.
In the green were housebuilders Taylor Wimpey, rising 3.0%, and Persimmon, up 0.9%. The average UK house price has hit a new record in September, pushing over GBP225,000 for the first time, according to Nationwide Building Society.
Nationwide said the average UK house price was GBP226,129 in September – the first time it has been above the GBP225,000 mark. In August, the average house price was GBP224,123.
House prices increased by 5% annually in September, marking the highest growth rate in four years. Prices increased by 0.9% month-on-month.
Surging to the top of the FTSE 250 was 888 Holdings, closing up 21% after revealing profit more than doubled in the first half of 2020 thanks to continued strong levels of customer acquisition and high use of online services during lockdown.
The FTSE 250-listed online gaming entertainment provider posted a pretax profit in the six months ended June 30 of USD50.9 million, more than doubling from USD22.2 million a year prior.
Revenue was up 37% to USD379.1 million from USD277.3 million a year before.
888 said third-quarter daily revenue to date is on average 56% higher than the year prior.
TP ICAP fell 16% after late Tuesday saying it is in advanced discussions concerning a potential acquisition of New York-based electronic trading network Liquidnet Holdings for a price ranging from USD600 million from USD700 million.
Liquidnet is said to be a specialist in equities dark trading, with a growing presence in fixed income. For the year to the end of June, Liquidnet generated adjusted earnings before interest, taxes, depreciation and amortisation of USD64 million, on revenue of USD339 million.
The UK corporate calendar for Thursday has half-year results from Burford Capital and Lamprell, while James Halstead posts full-year results.
In currency markets, the dollar was lower as stocks in Wall Street perked up.
The pound was quoted at USD1.2928 at the London equities close Wednesday, compared to USD1.2859 at the close on Tuesday.
The euro stood at USD1.1744 at the European equities close Wednesday, firm against USD1.1741 at the same time on Tuesday.
Against the yen, the dollar was trading at JPY105.46 compared to JPY105.61 late Tuesday.
The greenback's fall came despite some better-than-expected data.
According to ADP, US private sector employment increased by 749,000 jobs from August to September. The print beat the consensus estimate, cited by FXStreet, of 650,000 jobs.
The figures are a prelude to the closely watched US jobs report for September on Friday. The US economy is expected to have added 850,000 jobs, while September's unemployment rate is forecast to ease to 8.2% from 8.4% in August.
Meanwhile, the US economy shrank at a record rate in the second quarter, but plunge was marginally less bad than originally estimated, the latest figures from the Department of Commerce showed.
On an annual basis, US gross domestic product fell by a revised rate of 31.4% in the second quarter, having contracted 5.0% in the first quarter of 2020. The second-quarter reading was revised up slightly from the second estimate of a decline of 31.7%.
In Thursday's economic calendar, there are manufacturing PMIs from Ireland, Japan, Germany, the eurozone and UK at 0101 BST, 0130 BST, 0855 BST, 0900 BST and 0930 BST respectively. Eurozone unemployment and producer prices are at 1000 BST.
Later are US personal consumption expenditures and initial jobless claims at 1330 BST, followed by a Markit manufacturing PMI at 1445 BST and a manufacturing report from the ISM at 1500 BST.
Markets in China will be closed for a week from Thursday for the National Day Golden Week holiday, though markets in Hong Kong will only be shut for Thursday and Friday, re-opening on Monday.
By Lucy Heming; lucyheming@alliancenews.com
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