London open: Stocks nudge up but AB Foods, G4S weigh
London stocks nudged higher in early on Tuesday, taking their cue from positive sessions in the US and Asia but with weak performances from the likes of AB Foods and G4S keeping a cap on gains.
At 0825 GMT, the FTSE 100 was up 0.1% to 7,566.62 , while the pound was up 0.1% against the euro to 1.1357 and down 0.1% versus the dollar to 1.3160.
Konstantinos Anthis at ADS Securities said yesterday’s price action in the pound seemed to be overextended and should be attributed to the combination of traders' reaction to Bank of England deputy governor Ben Broadbent's comments on Friday and the dollar's pullback.
“The British currency should remain in play for the rest of the week as on Friday the release of the industrial and manufacturing production reports will reveal whether the domestic economy is performing above or below expectations. Analysts are expecting mixed numbers but if the reports surprise towards either direction we should see more volatility from the British currency.”
On the UK data front, a Halifax survey showed a third consecutive monthly rise in house prices. Investors will also eye a speech by European Central Bank chief Mario Draghi in Frankfurt at 0900 GMT.
Data released earlier showed showed UK retailers endured a "meagre month" of sales in October, with non-food retailers having the worst sales for at least six years.
Retail sales decreased by 1.0% in October a like-for-like basis versus a strong month last year, the British Retail Consortium said, with total sales up 0.2%, which is the lowest growth since May.
Over the three months to October, food sales increased 2.4% on a like-for-like basis and 3.7% on a total basis, which was above the 12-month average growth.
But non-food sales in the three months to October, decreased 0.4% on a like-for-like basis and increased 0.1% on a total basis, which is the lowest since the BRC started separating out non-food data in January 2011. The monthly decline was also the deepest since its records began.
Real household income has been on a downward trend this year as the acceleration in inflation amid low wage growth has created a more cautious shopper.
In corporate news, Imperial Brands gained ground as it reported a rise in full-year profit and revenue, allowing it to increase the dividend 10% for the ninth year in a row.
Insurer Hiscox was also on the front foot after posting a jump in gross written premiums for the first nine months of the year and revising down its estimates for claims related to recent hurricanes.
International sales, marketing and support services group DCC rallied after saying it has reached agreement with US-based NGL Energy Partners to acquire its ‘Retail West’ liquefied petroleum gas division, Hicksgas, based on an enterprise value of $200m (£152m).
Vodafone was little moved as it entered the ‘internet of things’ consumer market with the launch of its ‘V by Vodafone’ product, which enables consumers to connect to home and leisure electronics products via the group's dedicated global IoT network.
Unite Students rose after saying it has been given planning permission to build a 573-bed property in Manchester city centre.
Going the other way, Primark owner Associated British Foods was in the red despite reporting full-year results ahead of market forecasts after a "highly successful" year, with further progress expected in the coming 12 months, with analysts pointing out that the dividend was a touch light.
Security services firm G4S was in the red after it said trading in the nine months to the end of September was in line with expectations, but scaled back its guidance for full-year organic revenue growth.
Direct Line ticked lower after a mixed update for the first nine months of the year, in which it warned that the impairment charge in 2017 could exceed that incurred last year.
In broker note action, William Hill was boosted by a double upgrade to ‘buy’ at Bank of America Merrill Lynch, while Admiral was up after an upgrade to ‘add’ at Peel Hunt.
Genus was hit by an initiation at ‘hold’ by Kepler Cheuvreux and Lonmin fell after Peel Hunt cut the stock to ‘reduce’.
FTSE 100 - Risers
DCC (DCC) 7,440.00p 2.06%
BHP Billiton (BLT) 1,484.00p 1.37%
Convatec Group (CTEC) 191.00p 1.11%
Imperial Brands (IMB) 3,115.00p 0.97%
Rio Tinto (RIO) 3,804.50p 0.82%
Standard Life Aberdeen (SLA) 432.50p 0.77%
Royal Dutch Shell 'B' (RDSB) 2,508.00p 0.72%
Anglo American (AAL) 1,518.50p 0.70%
Royal Dutch Shell 'A' (RDSA) 2,475.00p 0.69%
Glencore (GLEN) 378.55p 0.69%
FTSE 100 - Fallers
G4S (GFS) 274.00p -2.00%
Direct Line Insurance Group (DLG) 360.10p -1.88%
Associated British Foods (ABF) 3,283.00p -1.79%
Sky (SKY) 924.50p -1.60%
Rolls-Royce Holdings (RR.) 973.50p -0.76%
Mediclinic International (MDC) 596.50p -0.75%
NMC Health (NMC) 3,149.00p -0.51%
Micro Focus International (MCRO) 2,636.00p -0.49%
Marks & Spencer Group (MKS) 329.70p -0.42%
Merlin Entertainments (MERL) 378.90p -0.42%
FTSE 250 - Risers
Ladbrokes Coral Group (LCL) 137.90p 2.91%
William Hill (WMH) 268.20p 2.84%
Just Group (JUST) 153.40p 2.68%
Tullow Oil (TLW) 198.80p 2.47%
Saga (SAGA) 192.50p 2.18%
Nostrum Oil & Gas (NOG) 386.00p 1.63%
Coats Group (COA) 88.60p 1.14%
JD Sports Fashion (JD.) 365.00p 1.02%
Rotork (ROR) 269.80p 0.86%
Go-Ahead Group (GOG) 1,791.00p 0.84%
FTSE 250 - Fallers
Genus (GNS) 2,432.00p -2.21%
St. Modwen Properties (SMP) 382.40p -2.20%
Hikma Pharmaceuticals (HIK) 1,062.00p -1.67%
Dixons Carphone (DC.) 158.70p -1.61%
Ibstock (IBST) 254.90p -1.20%
Fisher (James) & Sons (FSJ) 1,581.00p -1.19%
Provident Financial (PFG) 905.50p -1.04%
Bodycote (BOY) 927.00p -0.80%
Inchcape (INCH) 762.00p -0.78%
JPMorgan Indian Investment Trust (JII) 773.50p -0.77%