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Market Wrap - Market Open

FTSE mixed as buyers see value in miners, financials

28 March 2017 08:56

London shares are mixed in early deals, albeit barely moved, as the market takes pause after Monday's sell-off on dollar weakness and a waning of the 'Trump effect', with blue-chip miners and financials recouping some of their losses of buyers weigh in.

There was an evident note of caution throughout the market as traders and investors looked ahead to Wednesday, when PM Theresa May would trigger Article 50, beginning formal divorce talks with the European Union.

Soon after the open, the FTSE 100 was up 12.29 points, or 0.17%, to 7305.79, and the FTSE 250 was down 29.56, or 0.16%, to 18,870.4. At about 8.43am, WTI and Brent crude were moderately ahead, while cold and copper were similarly down. The pound was gaining on the dollar.

Wolseley (WOS), up 7.72% to 5260p and leading blue-chip risers, expected to achieve further progress in H2 as its interim dividend rose to 36.76p, from 33.28p, H1 pretax profit was £328m, from £367m. The company also unveiled a change of name to Ferguson Plc.

It was followed by financials including Aviva (AV.), up 1.77% to 532.25p, and Standard Chartered (STAN), up 1.75% to 735.65p. More financials followed, as did several utilities and a number of retail-related stocks.

United Utilities (UU.), up 0.2% to 1008p, said current trading was in line with its views, warning that while underlying operating profit for 2016-17 was seen moderately higher its revenue would be slightly lower on the year.

Miners such as BHP Billiton (BLT), up 1.44% to 1214.25p, Glencore (GLEN), up 1.36% to 309.9p, and Rio Tinto (RIO), up 1.28% to 3172p, as investors snapped up buying opportunities after Monday's sell off.

To the blue-chip downside fallers numbered about 38, with the majority of these down percentages of up to 0.5% or less. Babcock International (BAB) fell 1% to 868.25p to lead, and was followed by multiple house builders after Taylor Wimpey (TW.), down 0.88% to 191p, and Barratt (BDEV), down 0.51% to 541.25p.

Tesco (TSCO), up 0.04% to 190.03p, said it expected to book a £235m exceptional charge for penalty, compensation scheme and related costs linked to its historic accounting scandal, after striking deals with the Serious Fraud Office and Financial Conduct Authority.

National Grid (NG.), up 0.37% to 1018.75p, said that through the ongoing reviews of UK Electricity Transmission's investment plans, it had concluded some investments were no longer needed in this price control. It had volunteered a deferral of £480m of RIIO T1 allowances.


Tasty (TAST) fell 22.81% to 88p on stating trading since year's end had proved challenging and warned it expected headline operating profit for 2017 would be below that achieved in 2016. FY headline operating profit before pre-opening costs and non-trading costs in was up 21% to £4.8m.

Genel Energy (GENL) dropped 17.63% to 60.13p after it said, given ongoing uncertainties, the previous guidance for 2017 Taq Taq gross average production of 24-31,000 bopd had been removed. Genel now intended to announce Taq Taq field production on a monthly basis.

TomCo Energy (TOM), up 17.65% to 0.1p, has incorporated a new Utah-based subsidiary named TurboShale Inc, which would seek to develop and commercialise new propriety technologies for processing oil shale. A Letter of Intent outlining the principal commercial terms of this collaboration has been agreed between the company, JR Technologies and VDP, and it was expected that the final co-operative framework agreement would be executed soon.


Tethyan (TETH) fell 14.63% to 4.38p on has raised £1m gross from a placing of 22.2m shares at 4.5p each. Net proceeds would be used for a 6000m exploration drilling programme at the Suva Ruda project, and for general working capital.

Baron Oil (BOIL) shed 13.33% to 0.33p after it noted frustration given the continuing delays brought about by governmental bureaucracy and by its recalcitrant partner in Peru. It was excited by the opportunities seen in Southeast Asia and hoped to announce progress soon.

Instem (INS), down 8.82% to 186p, has posted FY revenues up 12% to £18.3m, with recurring revenues up 21% at £12.1m and software as a service revenues up 38% at £2.9m. Underlying earnings -- prior to interest, tax, depreciation and amortisation and non-recurring items -- fell to £1.3m, from £2.5m.

Ladbrokes Coral (LCL), down 2.81% to 131.5p, said its FY proforma group operating profit rose to £264.3m, up 22%. The merger of Ladbrokes and Coral had been successfully completed and there was good momentum in the combined business. Proforma group revenue rose 11% to £2.35bn.

Card Factory (CARD), down 2.81% to 266.3p, has said underlying operating profits were 3.0% up at £87.8m. Its total dividend was 9.1p a share, up 7.1%. The company also declared a special dividend of 15p a share, unchanged from last time. Revenues rose 4.3% to £398.2m.

CloudCall (CALL), up 2.43% to 105.5p, said group revenues rose 47% to £4.9m in the year to end-December. It noted that 85% of revenue was recurring and recurring revenues were up 63% compared to 2015. Operating loss before non-recurring items fell to £3.7m, from £4.5m.

Thomas Cook Group, down 2.2% to 87.38p, has maintained its FY underlying EBIT guidance and said trading for the group was progressing in line with its expectations. While some parts of the group were seeing some margin pressure due to rivalry, overall demand for summer holidays was strong.

AA (AA.), up 2.23% to 261.5p, said its FY trading revenues rose 1.6% to £940m. Group trading EBITDA rose 0.2% to £403m. The results were in line with expectations, with strong operational cash flow and dividend progression.

TClarke (CTO), down 1.31% to 84.75p, reported FY underlying operating profits up 35% to £6.9m, with its forward order book up 10% to £330m. Revenue from continuing operations rose 15% to £278.6m. The company said it was delighted with the results.

AG Barr (BAG), up 1.14% to 553p, said its FY statutory pretax profit rose 4.4% to £43.1m, from £41.3m, on revenue of £257.1m, from £258.6m. Total proposed dividend was 14.4p a shre, up 8%. It said it had made considerable progress in volatile and uncertain market conditions.

Segro (SGRO), down 0.61% to 453.1p, said its one-for-five rights issue of 166.03m shares at 345p each achieved acceptances of about 97.8%. Valid acceptances totalled 162.34m shares.

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