London open: Stocks edge lower after subdued Asian session; Burberry slumps

(Sharecast News) - London stocks edged lower in early trade on Monday following a subdued session in Asia, with Burberry under the cosh as it announced the departure of its chief executive.
At 0915 BST, the FTSE 100 was down 0.3% at 7,112.66.

Neil Wilson, chief market analyst at Markets.com, said: "Heading into the last three trading days of the quarter, the FTSE 100 is up around 1.5% in June and almost 6% for the quarter as it holds above 7,100. Sentiment may be cool this morning but it's been a solid turnaround from last Monday, when it struck 6,950.

"US futures are little changed after the S&P 500 notched a fresh record on Friday and enjoyed its best week since February. Core PCE inflation was a tad cooler than expected, giving investors the green light to give equities some bid despite the myriad risks on the horizon, including rising Covid cases in Asia. There is also a strong hope that President Biden's $1tn bipartisan infrastructure deal will be passed."

In equity markets, travel stocks were under pressure as German Chancellor Angela Merkel attempts to secure an EU-wide quarantine policy for British tourists. InterContinental Hotels, British Airways owner IAG, Premier Inn owner Whitbread, Upper Crust owner SSP, travel company Tui and budget airline easyJet were all lower.

Luxury fashion Burberry was the worst performer on the FTSE 100 on news that chief executive officer Marco Gobbetti was planning to step down at the end of the year to take up the role of CEO at Italy's Salvatore Ferragamo.

Wilson said: "It presents near-term risks - investors will want to know who takes over the reins and whether there is change in strategy. Given the consolidation in the luxury sector, and the current valuation versus peers, it could be a target.

"Whilst there are some pandemic-related issues still being washed out, Burberry remains a strong brand in the luxury space with room to appeal to a broader consumer base over the coming years."

NatWest lost ground after saying it was selling most of its Irish commercial lending business to Allied Irish Banks as part of its exit from Ireland.

Ultra Electronics slumped after the aerospace and defence group said it had terminated "very early stages" of exploratory talks with Cobham about a possible combination of some of their units. The shares rallied sharply on Friday on news of a possible deal.

On the upside, High Street bakery chain Greggs gained after it reported a stronger-than-expected recovery in sales from the Covid pandemic since May 10, with like-for-like growth of 1%-3% against the same period in 2019 before the crisis began.

In broke note action, Dr Martens was on the rise after an upgrade to 'buy' at HSBC, but St James's Place fell after a downgrade to 'hold' by the same outfit.



Market Movers

FTSE 100 (UKX) 7,112.66 -0.33%
FTSE 250 (MCX) 22,596.99 -0.22%
techMARK (TASX) 4,464.58 -0.31%

FTSE 100 - Risers

Informa (INF) 509.80p 1.23%
Hikma Pharmaceuticals (HIK) 2,446.00p 1.12%
Evraz (EVR) 606.60p 1.07%
AstraZeneca (AZN) 8,582.00p 0.98%
Associated British Foods (ABF) 2,275.00p 0.98%
Berkeley Group Holdings (The) (BKG) 4,669.00p 0.76%
Pershing Square Holdings Ltd NPV (PSH) 2,615.00p 0.58%
British American Tobacco (BATS) 2,802.50p 0.57%
GlaxoSmithKline (GSK) 1,421.20p 0.57%
Phoenix Group Holdings (PHNX) 675.60p 0.48%

FTSE 100 - Fallers

Burberry Group (BRBY) 2,066.00p -8.18%
InterContinental Hotels Group (IHG) 4,864.00p -2.33%
Rolls-Royce Holdings (RR.) 104.12p -2.23%
International Consolidated Airlines Group SA (CDI) (IAG) 183.36p -2.20%
Weir Group (WEIR) 1,883.00p -1.93%
Whitbread (WTB) 3,139.00p -1.78%
Flutter Entertainment (CDI) (FLTR) 13,525.00p -1.67%
Royal Mail (RMG) 573.80p -1.38%
Entain (ENT) 1,775.50p -1.36%
St James's Place (STJ) 1,483.00p -1.33%

FTSE 250 - Risers

PureTech Health (PRTC) 358.00p 3.77%
Chrysalis Investments Limited NPV (CHRY) 274.00p 3.01%
Dr. Martens (DOCS) 452.20p 2.87%
Drax Group (DRX) 435.40p 2.64%
AO World (AO.) 250.40p 2.20%
Softcat (SCT) 1,829.00p 2.06%
Premier Foods (PFD) 107.80p 1.51%
HGCapital Trust (HGT) 343.00p 1.48%
Crest Nicholson Holdings (CRST) 417.40p 1.36%
Beazley (BEZ) 333.10p 1.28%

FTSE 250 - Fallers

Ultra Electronics Holdings (ULE) 2,146.00p -6.70%
TUI AG Reg Shs (DI) (TUI) 390.10p -3.82%
SSP Group (SSPG) 281.50p -3.40%
National Express Group (NEX) 271.00p -2.80%
Aston Martin Lagonda Global Holdings (AML) 1,843.50p -2.74%
Trainline (TRN) 289.00p -2.69%
easyJet (EZJ) 929.40p -2.68%
Playtech (PTEC) 456.60p -2.52%
Cineworld Group (CINE) 81.42p -2.19%
Ferrexpo (FXPO) 440.80p -2.13%