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FTSE slumps as airlines remain weak

18 August 2017 16:53

Weakness in cigarette sellers and airlines continued to weigh on the FTSE 100, which finished Friday down 0.8% at 7,323.

Imperial Brands (IMB) and British American Tobacco (BATS), which are among the biggest companies in terms of market cap, fell 1.8% and 2.1%.

Thursday's terror attack in Barcelona triggered a slump in airline stocks as investors were worried that people would be less likely to go on holidays overseas due to the threat of further attacks. This could hit profitability in the sector.

Low-cost airline Ryanair (RYA) declined 1.8% to €18.57. British Airways owner International Consolidated Airlines (IAG) shed 3.1% to 604.3p while easyJet (EZJ) nudged 0.9% lower to £12.89.

In a spot of good news, overseas residents made 3.5 million visits to the UK in June - a 7% increase compared to June 2016 according to the Office for National Statistics.

Brent crude oil rallied 1.1% to $51.62 per barrel. Gold gained 0.5% to $1,293 per ounce and copper was flat at $6,459 per tonne.

OVERSEAS MARKETS

In the US, the stock markets started to bounce back but remained in the red as investors remained cautious on whether US President Donald Trump can get through his economic policies.

FTSE 100 RISERS AND FALLERS

AstraZeneca (AZN) dipped 1% to £44.38 on the joint announcement with Merck that it gained US approval for its Lynparza treatment for ovarian cancer. The market was unimpressed with the approval as the use for Lynparza was for two tablets twice daily instead of eight capsules twice a day, which could impact sales.

FTSE 250 RISERS AND FALLERS

A warning over challenging weather conditions in certain regions took the shine off The Renewables Infrastructure Group's (TRIG) 63% rise in pre-tax profit. The stock retreated 0.8% to 108p.

Specialist investment trust Pershing Square (PSH) also suffered a weaker share price, down 0.8%, after returning -2.3% due to poor performances from a short position in Herbalife and a long position in Fannie Mae/Freddie Mac.

SMALL CAP RISERS AND FALLERS

A profit warning at System1 Group (SYS1) spooked investors as pre-tax profit is expected to drop by 10% to 15% in the year to 31 March 2018. Over a third of the company's value was wiped off, leaving the share price at 552.5p.

Internet video platform developer Forbidden Technologies (FBT) expanded an existing deal with 'an iconic sports, music and entertainment venue' in New York. Shares in the firm advanced 2.5% to 6.1p.

Story provided by StockMarketWire.com

Related Company: IMB

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