Naked Wine Share News (WINE)

(Alliance News) - The FTSE 100's losses accelerated as the morning progressed in London, down nearly 140 points at midday Wednesday as the previous session's optimism gave way to fears of growing Covid-19 cases in the US and fresh outbreaks in Europe.

The large-cap index was down 139.76 points, or 2.2%, at 6,180.36. The mid-cap FTSE 250 index was down 299.72 points, or 1.7%, at 17,353.08 and the AIM All-Share index was down 0.5% at 892.13.

The Cboe UK 100 index was down 2.3% at 10,449.95. The Cboe 250 was down 2.0% at 14,849.64, and the Cboe UK Small Companies down 0.9% at 9,616.34.

In mainland Europe, the CAC 40 in Paris was down 1.7% while the DAX 30 in Frankfurt was 2.1% lower Wednesday afternoon.

"Momentarily granted some relief thanks to Tuesday's largely better than forecast flash PMIs, Europe cliff-dived back into the red on Wednesday as the Covid-19 situation in the US grew increasingly grim," said Connor Campbell, financial analyst at Spreadex.

"Understandably investors were rather worried about this news, especially since it follows on from the recent outbreak in Beijing, a new cluster of cases in Tokyo, a record one-day total for new cases in Mexico and Monday's reports that Germany's R rate has crossed the crucial 1 level due to 1000s of cases at an abattoir," said Campbell. "That's because whatever fragile signs of recovery were observed in Tuesday's manufacturing and services PMIs would be wiped out if a substantial 'second wave' were to materialise."

US government health experts led by Anthony Fauci on Monday warned Congress that the country faces "historic" challenges with the virus and should prepare for a lengthy battle.

Fauci warned the next two weeks would be "critical to our ability to address...surgings" in Florida, Texas and other states.

Even in Europe, which has been loosening travel restrictions following a brutal few months when it was the epicentre of the pandemic, there have been major setbacks.

Germany on Tuesday reimposed lockdowns on more than 600,000 people following a cluster of infections at a slaughterhouse, while world men's tennis number one Novak Djokovic tested positive after hosting an exhibition tournament in the Balkans.

Portugal has also announced new restrictions in and around Lisbon.

In Japan, Tokyo governor Yuriko Koike on Wednesday warned a number of new cases had been found at one workplace.

And the UK faces a balancing act over the next few weeks as further parts of the economy open up.

Boris Johnson announced on Tuesday the biggest easing to date of the coronavirus lockdown in England. The prime minister said the two-metre social-distancing rule would be replaced with a "one-metre plus" rule paving the way for pubs, restaurants, hotels and cinemas to begin reopening from July 4.

In the wake of the decision, health leaders are calling for an urgent review to ensure Britain is properly prepared for the "real risk" of a second wave of coronavirus. The appeal is backed by the presidents of the Royal Colleges of Physicians, Surgeons, GPs and Nursing – as well as the chairman of the British Medical Association.

Wall Street is on course for a lower open on Wednesday. The Dow Jones is pointed down 1.0%, the S&P 500 down 0.9% and the Nasdaq Composite down 0.5%.

The dollar advanced amid Wednesday's uncertainty.

Sterling was quoted at USD1.2516 Wednesday midday, slipping from USD1.2526 at the London equities close on Tuesday. The euro traded at USD1.1297 on Wednesday, lower than USD1.1325 late Tuesday.

Even the safe-haven yen struggled. Against the Japanese unit, the dollar rose to JPY106.51 from JPY106.37.

Gold strengthened despite the dollar's rise. The precious metal was quoted at USD1,777.47 an ounce at midday, higher than USD1,765.19 on Tuesday.

As a result, among few risers in the FTSE 100 on Wednesday were precious metals miners Polymetal International and Fresnillo, up 1.7% and 1.0% respectively.

Meanwhile, oil is "struggling under the weight of Covid-19 headlines", said Stephen Innes, chief global markets strategist at AxiCorp.

Brent oil fell to USD42.18 a barrel from USD43.58 late Tuesday. In response, BP shares traded 2.7% lower at midday while Royal Dutch Shell 'A' and 'B' shares fell 2.8% and 2.9% respectively.

Elsewhere in London, mid-cap Petrofac fell 11%. The oil field services firm said Covid-19 and weak oil and gas prices hurt its performance in the first half of 2020, and it remains unclear how long oil prices will remain at low levels.

Petrofac said it expects first-half revenue for its Engineering & Construction business to be around USD1.6 billion, driven by Covid-19-related project delays. In comparison, for the first half of 2019, the company reported revenue of USD2.3 billion for the E&C division.

The company said its Engineering & Production Services division also was hurt by the deterioration in market conditions.

Crest Nicholson tumbled 9.1% as it swung to a pretax loss after Covid-19 dented its first-half performance, and its guided to a sharp drop in annual profit.

The Chertsey, England-based residential developer reported revenue for the six months to April 30 down 52% to GBP240.0 million, resulting in a swing to a pretax loss of GBP51.2 from a GBP64.4 million profit a year prior.

The FTSE 250 constituent said it saw strong sales momentum in the wake of the UK general election and the run-up to the spring selling season, but Covid-19 then hurt its first-half performance.

Crest said it now expects adjusted pretax profit to be around GBP35 million to GBP45 million for the current financial year, after achieving just GBP4.5 million in adjusted profit for the first half. A year ago, first half adjusted pretax profit amounted to GBP64.4 million. For the financial year to the end of October 2019, the firm reported adjusted pretax profit of GBP121.1 million.

Elsewhere in London, Premier Foods bounced 11% as it upgraded guidance for the financial year just begun.

The St Albans, England-based food maker reported revenue for the financial year ended March 28 up 2.8% to GBP847.1 million, swinging to a pretax profit of GBP53.6 million from a GBP42.7 million loss, as administrative costs fell 51% to GBP76.6 million.

Looking forward, revenue in the first quarter of the newly-started year is expected to be up 20% on a year ago, reflecting strong demand.

"Consequently, we expect to exceed current expectations for financial 2021 revenue and trading profit despite incurring some additional operating costs in our supply chain," said Chief Executive Alex Whitehouse.

On AIM, Naked Wines rose 6.0% as it reported a double-digit annual revenue rise, helped by growth in the US, and a boost in online orders towards the end of the period due to the Covid-19 lockdown.

Revenue from continuing operations in the year ended March 30 rose 14% to GBP202.9 million from GBP178.4 million, and its pretax loss narrowed to GBP5.4 million from GBP9.9 million.

The US was a key revenue growth driver for the wine business. Revenue in the US climbed 20% to GBP90.9 million. The Norwich-based firm, previously known as Majestic Wine, reported revenue growth of 11% to GBP80.0 million in the UK.

The company added that revenue in the first two months of financial 2021 was 81% higher annually.

By Lucy Heming; lucyheming@alliancenews.com

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