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Market Wrap - Midday

Shock poll prediction hits pound

31 May 2017 11:44

The pound struggled after a shock YouGov poll predicted a hung parliament after the upcoming UK General Election on 8 June, with suggestions the Conservative Party could lose up to 20 seats.

Against the dollar, the pound weakened 0.3% to $1.28. Brent crude oil fell by 2% to $50.82 per barrel, while gold was flat at $1,264 per ounce.

Copper nudged 0.1% lower to $5,643 per tonne.

A rally in consumer stocks offset weakness among miners, which helped the FTSE 100 gain 0.4% to 7,558.

Baileys and Smirnoff owner Diageo (DGE) led the sector higher as the shares sparked 1.4% to £23.56. Ice-cream-to-Marmite seller Unilever (ULVR) was up 1.3% and British American Tobacco (BATS) advanced 1.2%.

The Irish government confirmed it will float Allied Irish Banks with an expected value of €12bn. This was nearly half the €21bn of state funds put into the bank to help it survive the financial crisis of 2008.

OVERSEAS MARKETS

On Tuesday, lower oil prices and weakness in the energy and financial sectors dragged on the performance of the S&P 500, causing it to close 0.1% lower at 2,412.

Investor sentiment was subdued in Asia as upcoming elections in the UK, Germany and Italy unsettled the market on Wednesday.

Positive manufacturing data in China helped the SSE Composite advance 0.2% to 3,117.

FTSE 100 RISERS AND FALLERS

UK supermarket Tesco (TSCO) ticked 0.5% lower despite boosting sales by 1.8% year-on-year according to the latest data from Kantar Worldpanel.

Overall, the 'big four' - Tesco, Sainsbury's (SBRY) ASDA and Morrisons (MRW) - grew by 1.6% as its rival discounters Aldi and Lidl continued to grab market share.

FTSE 250 RISERS AND FALLERS

Spread betting business IG (IGG) was up 2.8% as it anticipated revenue and profit to be higher than expected in the year to 31 March 2017 thanks to a strong fourth quarter.

Shares in real estate investment trust Londonmetric Property (LMP) were marked 1.1% higher to 168.7p after it announced net rental income increased 5% to £82m. It also unveiled the acquisition of three logistics warehouses for £23.9m combined.

SMALL CAP RISERS AND FALLERS

Record full year profit and a bumper order book bode well for housebuilder Telford Homes (TEF) but failed to move the share price much at 430p.

China-based China New Energy (CNEL) was on a winning streak as it won seven contracts in the country since the start of 2017. It said the contracts were to design, supply and install ethanol processing equipment and upgrade its plants. Shares in the stock soared 34.3% to 1.5p.

In the mining sector, Bezant Resources (BZT) slumped 10% to 1.03p as investors were unsatisfied with its latest deal. The company signed an agreement with Exumax for the acquisition, commissioning and operation of its first gold-platinum production plant in Colombia.

Elsewhere in the oil and gas sector, Lamprell (LAM) agreed a proposed joint venture for a maritime yard for the construction, maintenance and repair of offshore drilling rigs and vessels in Saudi Arabia. The stock jumped 10.6% to 111.7p.

It was a bad day for water treatment services firm Nature Group (NGR) thanks to a 26% drop in sales and a widened loss before tax to £2.41m in the year to 31 December 2016, causing its shares to fall 13%.

Story provided by StockMarketWire.com

Related Company: TSCO

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