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Market Wrap - Midday

Potential US interest rate rise causes FTSE 100 to drop

19 May 2016 12:28

Fears over a potential rise in US interest rates caused concern for Chinese and European stocks and resulted in the FTSE 100 dropping 1.3% to 6,084.36 and the FTSE 250 to fall 0.7% to 16,758.5.

West Texas Intermediate crude was down 1.9% USD47.27 and Brent crude fell 2.3% to USD47.82.

BIGGEST RISERS AND FALLERS

British baby retailer Mothercare (MTC) returned to profitability as profits shot up to GBP9.7m in the 52 weeks to 26 March, compared to a loss of GBP13.1m in the previous year. The company attributes improvements in its customer offerings to its successful turnaround. Shares were up 4.5% to 124p.

Venture capital firm 3i (III) was up 3% to 503p after total return increased from GBP659m in 2015 to GBP824m in the full year to the end of March.

Laboratory-based tester Exova (EXO) reported that revenue increased by 15.4% since 31 December 2015 to date, which was driven by good organic growth and boosted shares 4.5% to 169.5p.

Holidaymaker Thomas Cook (TCG) warns that sales to various parts of the world haven't fully offset weak demand for Turkey. It also says booking for its summer season are down 5% overall, triggering a 17% decline in its share price to 74.35p.

Iron miner Ferrexpo (FXPO) suffered a 10% drop to 28.5p after saying production costs are going up.

Harvester owner Mitchell & Butlers (MAB) reported its pre-tax profit rose from GBP75m in 2015 to GBP83m in the 28 weeks ended 9 April through organic growth. Shares were up 3% to 285.6p as the company outlined plans to improve the quality of its estate.

OTHER HIGHLIGHTS

Harry Potter publisher Bloomsbury announced revenue grew by 11% to GBP123.7m as of 29 February, after its children's and education division delivered double digit revenue growth. However, this did not stop shares slipping more than 2.5% to 151p.

Cathedral City cheesemaker Dairy Crest (DCG) reported its pre-tax profit from continuing operations rose by 23% to GBP45.4m in the year to the end of March. This excludes any contribution from its milk division which was sold in December 2015. Shares dropped 1.5% to 573p.

Electronic distributor Electrocomponents (ECM) returned to growth in the UK after revenue improved from GBP1,266.2m in 2015 to GBP1,291.1m for the year ended 31 March, boosting shares 1.5% to 264.4p.

Energy transmission company National Grid's (NG.) operating profit rose 6% to GBP4.1bn, although shares dropped nearly 3% to 971.3p.

UK distributor Royal Mail (RMG) revealed its operating profit before transformation costs was up slightly from GBP740m as of 29 March 2015 to GBP742m in the 52 weeks to 27 March. Profit before tax fell from GBP569m to GBP538m and shares slid 4% to 187.4p.

UK cinema chain Cineworld (CINE) achieved solid revenue growth of 9.8% in 19 weeks to 12 May, but the shares were flat at 540.5p.

Tonic water producer Fevertree (FEVR) outperformed expectations as the premium mixed market continued to grow, and anticipates its full year results will be materially ahead of expectations, boosting its shares 12.5% to 673p.

Alton Towers owner Merlin (MERL) performed broadly in line with expectations, although its shares dropped nearly 3% to 418.7p.

Travel agent On The Beach's (OTB) operating profit before EBITDA went 35.5% to GBP10.3m, but shares crashed nearly 8% to 280p amid negative sentiment towards the holiday sector on the back of Thomas Cook's poor trading update and the missing EgyptAir plane.

QM Systems, a subsidiary of Pipehawk (PIP) announced a partnership with Primafruit to deliver a high technology handling system as part of Primafruit's Evesham facility. Shares shot up 20% to 5.13p.

Life science company Valirx (VAL) revealed that they are considering late-stage clinical studies for VAL201 and VAL401 compounds. Shares fell 15% to 11.25p.

ECONOMIC NEWS

Retail sales in April increased by 4.3% since April last year as people hit the shops more, according to the Office for National Statistics.

Story provided by StockMarketWire.com

Related Company: MTC

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