LONDON MARKET MIDDAY: FTSE 100 Edges Higher Despite Sainsbury's Slump

LONDON (Alliance News) - Stocks were slightly higher at midday on Wednesday, with a tumble for J Sainsbury following a blow to its merger with Asda capping the FTSE 100's gains.The FTSE 100 was 9.39 points higher, or 0.1%, at 7,188.56 Wednesday midday. The mid-cap FTSE 250 was up 70.26 points, or 0.4%, at 19,139.15, and the AIM All-Share index was down 0.1% at 906.49.The Cboe UK 100 index was up 0.1% at 12,206.47, while the Cboe UK 250 was up 0.4% at 17,039.00 and the Cboe UK Small Companies down 0.4% at 11,168.91.In mainland Europe, the CAC 40 in Paris and the DAX 30 in Frankfurt were both up 0.2% at midday.In New York, stocks are pointed to a lower start ahead of the latest set of minutes from the Federal Open Market Committee, due to be release at 1900 GMT. The Dow Jones is seen down 0.1%, as is the S&P 500, while the Nasdaq is called flat. The pound was quoted at USD1.3020 at midday, down from USD1.3036 late Tuesday and having traded above the USD1.3070 mark earlier on Wednesday.Adding to resignations from the Labour party earlier this week, three MPs have now quit the Conservative party in a major blow to UK Prime Minister Theresa May's authority.Remain-supporting Heidi Allen, Anna Soubry and Sarah Wollaston are leaving to join the new Independent Group, the party formed by eight ex-Labour MPs, which include former shadow ministers Chuka Umunna, Luciana Berger and Chris Leslie.The move poses a fresh headache for May as she prepared to face Prime Minister's Questions in the Commons before heading to Brussels for Brexit talks with Jean-Claude Juncker.The three former Conservative MPs said: "We no longer feel we can remain in the party of a government whose policies and priorities are so firmly in the grip of the ERG and DUP.""The final straw for us has been this government's disastrous handling of Brexit," they added.In London, oilfield services provider John Wood Group rose 4.5% to be the best performer in the FTSE 100 after Merrill Lynch resumed its rating on the stock with Buy.Lloyds Banking, meanwhile, climbed 3.9% as it posted a strong rise in annual profit and increased its dividend and share buyback scheme.In 2018, Lloyds's pretax profit increased 13% to GBP5.96 billion from GBP5.28 billion the year before. The FTSE 100-listed bank's net income increased 1.7% to GBP17.77 billion from GBP17.47 billion in 2017, in line with consensus. Net interest income increased 3.2% to GBP12.71 billion from GBP12.32 billion.Lloyds declared a total dividend of 3.21 pence, up 5% on 2017. It also announced an intention to embark on a GBP1.75 billion share buyback, increasing the GBP1 billion share buyback announced in 2017. Limiting the FTSE 100's gains was J Sainsbury as it slid 16% after the UK competition regulator said it is considering blocking the supermarket's tie-up with Walmart-owned grocer Asda.The UK Competition & Markets Authority said it has found the deal could lead to higher prices, a poorer shopping experience, and reductions in the range and quality of products offered. It also believes the deal could lead to a rise in fuel costs at more than 100 locations where Sainsbury's and Asda petrol stations overlap.The CMA has potential options for addressing its concerns, including blocking the deal or requiring the merging companies to sell off a "significant" number of stores."The CMA's current view is that it is likely to be difficult for the companies to address the concerns it has identified," the competition regulator said.Sainsburys, in response, said it "fundamentally" disagrees with the findings and believes they "misunderstand how people shop in the UK today and the intensity of competition in the grocery market"."To see such resistance from the CMA at this stage in its review would suggest there is little chance of Sainsbury's and Asda coming together. The language used in the CMA's announcement implies the merger will be blocked," said Russ Mould, investment director at AJ Bell.However, he noted: "Sainsbury's will no doubt keep fighting, particularly as its own business desperately needs the Asda deal to inject a bit of life into the company."Shares in Wm Morrison Supermarkets, which had been expected to benefit from the deal by snapping up stores sold off by Sainsbury's and Asda in order to fulfil the CMA's competition requirements, were down 4.9%.FTSE 250 constituent Intu Properties tumbled 8.4% as the shopping centre owner skipped its final dividend after a difficult year, with the firm wanting to reduce its debt rather than distribute the cash to shareholders.The shopping centre owner's debt to earnings ratio was 53% at the end of 2018, above its 50% self-imposed limit, from 45.2% at the end of 2017.intu made a 9.4p final payout a year ago. The lack of a final payout for 2018 brings total dividends paid in respect of the year to 4.6p, a reduction on the 14.0p paid for 2017.intu's 2018 like-for-like net rental income growth was 0.6%, improved from 0.5% in 2017, though total net rental income fell to GBP450.5 million from GBP460.0 million.Peer Hammerson fell in a negative read-across, down 3.0% at midday.Elsewhere on the Main Market, shares in McBride slumped 31% after the household and personal care goods manufacturer warned of lower annual profit due to cost pressures.The company said that it continued to see pressure on its cost base, with the price of raw materials showing improvement since the end of the first half in December, but "not to the extent anticipated in early January".In addition, distribution costs continue to rise "beyond our previous estimates", McBride said, due to market rates and efficiency challenges driven by logistics capacity shortfalls and internal service gaps.Because of this, McBride said it expects a reduction of between 10% and 15% in its annual adjusted pretax profit on the prior year.