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London close: Stocks caught in downdraft on Wall Street, but finish off lows

(WebFG News) - London stocks fell further into the red on Wednesday, taking their cue from a sell-off on Wall Street amid rising government bond yields in the States, despite higher takeover offers boosting Sky and Shire.
Nevertheless, while the FTSE 100 was down 0.62% to 7,379.32, it did manage to finish off its lows of the session.

In parallel, the pound was again lower, trading off by 0.3% against the dollar at 1.3936 but was 0.17% higher versus the euro to 1.1446.

Ten-year Gilts on the other hand were little changed, with their yield repeating for another day at 1.1446%.

IG analyst Chris Beauchamp said: "Equities continue to find it tough going at the moment, with solid losses in the UK and Europe and US stocks moving into the red once more. Early signs of a possible stabilisation before the US open were seen, but stocks swiftly fell once more. However, there appears to be a number of brave buyers out there, stepping in to pick up shares and get the Dow off its lows after an hour or so of trading. Earnings season continues to punish those with doubts about the global outlook, as Twitter found out to its cost.

"A pre-market jump on headline earnings beats was sent brutally into reverse as the firm's outlook for the year struck a distinctly gloomy note. This is all very similar to Caterpillar last night, and the fact that such disparate companies are being treated in such a similar way speaks to a definite sense of unease among investors."

A busy day for corporate news was dominated by M&A action, with Sky shares popping higher as US cable TV company Comcast made a formal takeover offer for the broadcaster of 1,250p that trumps the one made by 21st Century Fox.

Shire also rose after its directors said they would be willing to recommend the latest takeover proposal from Takeda Pharmaceutical that was pitched at roughly £49 per share, subject to further conditions. The UK Takeover Panel has given the two companies a new deadline of 1700 BST on 8 May to conclude talks.

Whitbread dipped after saying it would spin off its Costa coffee chain into a separate listed business within the next two years following activist pressure, though shares in the Premier Inn owner reversed earlier gains to trade lower by noon. The company, which also released its preliminary results on Wednesday, said the demerger would be pursued "as fast as practical and appropriate to optimise value for shareholders".

The biggest faller was specialty chemicals group Croda International despite saying it was on track to meet expectations for the year and posting a 4% rise in core sales for the first quarter. Excluding currency swing, sales were down 2.7% in the quarter.

Lloyds Banking Group slipped despite posting a 23% increase in first-quarter profit, with some analysts pointing to a worrying rise in impairment provisions.

Metro Bank was under the cosh even as it posted a 41% jump in first-quarter deposit growth as lending and customer numbers grew, as the company's Common Equity Tier 1 ratio, a key measure of capital strength, fell 170 basis points to 13.6% at the end of the quarter compared to the end of last year. Analysts at RBC Capital said near-term regulatory and investment costs are higher than expected and so they reduced EPS estimates by 10% for this year and 6% for next.

Fresnillo and Antofagasta were both in the red following the release of first-quarter production reports.

On the upside, CRH reversed course to trade up after the building materials group reported a drop in first-quarter sales and announced plans for a 1bn share buyback.

Persimmon edged up after saying it was trading well this year after customer enquiries and sales of its houses increased. The housebuilder said enquiries were up 13% from a year earlier and that forward sales revenue had risen 8% to £2.76bn.

Fenner ticked up as it reported a jump in interim pre-tax profit and revenue and said its acquisition by Michelin should take effect on 31 May.

On the broker note front, Prudential was cut to 'neutral' at Citi and Intertek was downgraded to 'underperform' at Credit Suisse.

Market Movers

FTSE 100 (UKX) 7,379.32 -0.62%
FTSE 250 (MCX) 20,019.08 -0.87%
techMARK (TASX) 3,385.00 -1.42%

FTSE 100 - Risers

Sky (SKY) 1,358.24p 3.90%
Imperial Brands (IMB) 2,472.00p 3.50%
British American Tobacco (BATS) 3,850.00p 2.83%
CRH (CRH) 2,547.00p 2.25%
Evraz (EVR) 421.50p 2.01%
Associated British Foods (ABF) 2,627.00p 1.93%
Marks & Spencer Group (MKS) 283.60p 1.43%
Pearson (PSON) 796.40p 1.35%
Reckitt Benckiser Group (RB.) 5,494.00p 0.94%
United Utilities Group (UU.) 714.40p 0.76%

FTSE 100 - Fallers

Ashtead Group (AHT) 2,010.00p -4.96%
Anglo American (AAL) 1,675.00p -4.15%
Croda International (CRDA) 4,438.00p -3.92%
GlaxoSmithKline (GSK) 1,412.20p -3.42%
Smurfit Kappa Group (SKG) 3,010.00p -2.84%
Intertek Group (ITRK) 4,764.00p -2.82%
Shire Plc (SHP) 3,820.00p -2.80%
easyJet (EZJ) 1,580.00p -2.65%
Just Eat (JE.) 736.00p -2.31%
Glencore (GLEN) 378.00p -2.25%

FTSE 250 - Risers

Capita (CPI) 184.40p 4.00%
Bakkavor Group (BAKK) 187.00p 2.73%
Euromoney Institutional Investor (ERM) 1,296.00p 2.53%
JD Sports Fashion (JD.) 391.20p 2.33%
Capital & Counties Properties (CAPC) 279.50p 2.19%
Inmarsat (ISAT) 367.00p 1.97%
Tate & Lyle (TATE) 570.60p 1.93%
RDI Reit (RDI) 36.90p 1.79%
On The Beach Group (OTB) 600.00p 1.69%
Greencore Group (GNC) 159.30p 1.37%

FTSE 250 - Fallers

Metro Bank (MTRO) 3,260.00p -7.33%
Clarkson (CKN) 2,375.00p -6.50%
Tullow Oil (TLW) 229.00p -4.06%
Equiniti Group (EQN) 276.50p -3.82%
Elementis (ELM) 282.40p -3.75%
Games Workshop Group (GAW) 2,460.00p -3.73%
Alfa Financial Software Holdings (ALFA) 352.00p -3.56%
Renishaw (RSW) 4,704.00p -3.49%
Essentra (ESNT) 422.20p -3.17%
TBC Bank Group (TBCG) 1,796.00p -3.02%

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