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Insurers and utilities drag FTSE lower

22 June 2017 16:59

Investor sentiment remained subdued as insurance and utility stocks weighed on the FTSE.

Direct Line (DLG) fell 1.9% to 356.9p, RSA Insurance (RSA) ticked 1.8% lower to 617p.

Severn Trent (SVT) was down 1% to £23.03, while United Utilities (UU.) declined 1.5% as it went ex-dividend.

The FTSE closed down 0.1% at 7,439.

OVERSEAS MARKETS

Last night, Brent crude oil prices hit a six-month low at around $45 per barrel, which dragged on US equities. Little had changed today despite a 2% jump in the oil price to $45.73. The S&P 500 opened flat at 2,436.

FTSE 100 RISERS AND FALLERS

Housebuilder Barratt Developments (BDEV) appointed Jessica White as chief financial officer, although the market response was muted as the shares barely moved at 568.5p.

Alcohol giant Diageo (DGE) agreed to buy George Clooney's tequila brand Casamigos in a deal that was valued at up to $1bn. Investors were unimpressed by the deal and the stock fell flat at £23.36.

It was good news for Standard Life (SL.) after Britain's competition watchdog approved the company's £11bn deal to buy Aberdeen Asset Management (ADN). The deal is set to create the country's biggest listed asset management firm. Shares in both asset managers were flat as the approval was anticipated by the market.

A jury ordered Teva Pharmaceutical Industries to pay pharma giant GlaxoSmithKline (GSK) over $235m for infringing its drug Coreg, a beta blocker to treat heart failure.

FTSE 250 RISERS AND FALLERS

In the mid-cap sector, Saga (SAGA) persevered against a difficult economy as its core insurance and travel businesses continued to perform well throughout the year.

A delay in approving the US 2017 budget was bad news for Ultra Electronics (ULE). The defence group blamed the delay on the deferral of US orders to the end of the first half and second half of this year, prompting a 2.4% decline to £20.20.

Shares in Southern operator Go-Ahead (GOG) were going nowhere despite a decent trading update with no nasty surprises. The company said that no significant industrial action on Southern services meant performance was more stable, but an upcoming overtime ban might result in unnecessary disruption.

An unconfirmed report from India's Business Standard focused on Cairn Energy (CNE). It said that the oil exploration firm's 9.8% stake in Cairn India might be put up for sale under tax recovery proceedings which started last week.

SMALL CAP RISERS AND FALLERS

Imagination Technologies (IMG) enjoyed a 16.4% rally in its share price to 143.7p after it put itself up for sale. It has been a difficult year for Imagination due to a dispute with its key customer Apple, which wiped off 70% of its market value.

Medtech firm EGI (EGI) announced it was to be acquired by Phillips for £29m, sparking a 31% rally in the shares to 101.5p.

Over a third of mobile start-up The People's Operator's (TPOP) market value was wiped off to 3.7p as it missed full year expectations and revealed a set of underwhelming numbers.

Story provided by StockMarketWire.com

Related Company: BDEV

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