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30 Jul 2019 | 09:05

UK stocks continue gains as sterling drops

UK stocks have opened higher after getting a boost from oil and gas giant BP and continued weakness in the pound.

Strong quarterly results from BP helped offset some of the fallers, with Centrica and Reckitt Benckiser shares getting off to bad starts in early trading following less than stellar news.

Meanwhile sterling has continued to slide, dropping below $1.22 with markets still nervous over Prime Minister Boris Johnson's no-deal Brexit rhetoric.

At 9:00, the benchmark FTSE 100 index stood 0.19%, or 14.5 points, higher at 7,701.99.

Centrica was the biggest faller of the morning as its shares plunged 10.3% to 81.5p, following a triple whammy of negative news.

The firm's chief executive Iain Conn is set to step down from his role after it reported an operating loss of £446m for the six months to 30 June, blaming an 'extremely challenging' market environment.

The company is also slashing its dividend to 1.5 per share, compared to 3.6p last year, and announced plans to sell its oil and gas production operations.

Reckitt Benckiser shares fell 3.9% to £64.11 as it cut its sales growth forecast following weaker than expected trading.

The firm revised its full year like for like revenue target to 2-3% after a flat first half of the year, hit by a slowdown in demand for its infant formula in the US and China, its biggest market.

BP rose 3.2% to 544p as its measure of net income beat market expectations.

Its underlying replacement cost profit - a closely watched measure to gauge performance - for the second quarter of 2019 was $2.8bn, little changed from the $2.82m a year earlier, as it was held back by lower oil prices. But the figure was better than analysts expected, hence the share price rise.

Fresnillo tumbled 7.8% to 732p as it reported a fall in profits, following lower production and sales of gold and silver in the first half and a fall in metal prices which dented performance.

Gross profit and earnings (EBITDA) of US$205.5m and US$307.9m, were down 59.1% and 45.7%, respectively. Total revenues decreased 10.1% to US$1,069m in the half.

Anglo American dipped 0.3% to £21.07 after it said the value of rough diamond sales at its De Beers unit had decreased during the sixth cycle of 2019 to $250m from $391m seen in the fifth cycle.

The figure compared to $533m seen in the sixth cycle of 2018.

Greggs dropped 2.2% to £23.32 despite declaring a special dividend after reporting 'exceptionally strong' half-yearly performance as its new vegan-friendly sausage roll continued to rake in sales.

But the market was more concerned that Greggs said it warned on higher food input costs in the balance of the year, resulting in overall cost inflation being at the higher end of its expectations. Story provided by StockMarketWire.com
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