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28 Aug 2019 | 16:58

FTSE 100 reverses losses at close as pound slumps on PM's Parliament suspension

UK stocks were bumped and buffeted through the afternoon session on Wednesday after a day of political and macroeconomic swings and roundabouts. The Queen's sign-off on Prime Minister Boris Johnson's plan to suspend Parliament next month upped the ante on a no-deal Brexit while 30-year US treasury yields slumped to an all-time low.

It also puts UK corporate earnings under the investor spotlight with overseas earnings-heavy FTSE 100 reversing earlier losses to rally 25 points higher at 7,114.71 at the close.

Conversely, the UK mid cap FTSE 250 index, which is more exposed to revenues earned in the UK, slumped sharply, falling 111 points to 19,224.79.

POLITICS OVERSHADOWS CORPORATE NEWS

Emerging events from Downing Street and elsewhere overshadowed an otherwise quiet day for major company news, although in the risk-off atmosphere it was little wonder that gold mining group Fresnillo topped the FTSE 100 leader board, posting a 4%-plus gain to 726.8p.

UK housebuilders hit the skids with Barratt Developments, Persimmon, Taylor Wimpey all following Berkeley 4%-plus lower.

British American Tobacco posted a modest decline after US rival Philip Morris announced merger talks to reunite with previous spin-off Altria. BAT slipped 0.2% to £28.28 while peer and Imperial Brands was by and large flat at £20.61.

Struggling travel company Thomas Cook dropped 17% to 5.85p after it agreed key terms of a rescue deal with China's Fosen and its debt holders that could see its shares delisted.

Fosen agreed to pay £450m for 75% of the company's tour operator unit and 25% of its airline, while lenders would provide another £450m converting existing debt into 75% of the airline and 25% of the tour operator.

Oil services group Petrofac reversed earlier losses to make a modest 0.4% gain at 407.8p, after swinging to a first-half profit, after it said its order intake had been hurt amid a Serious Fraud Office probe into its contract dealings in Saudi Arabia and Iraq.

Petrofac also warned that its revenue would fall next year.

Marine contractor James Fisher and Sons fell 4.7% to £20.25 after it booked a 3% fall in first-half profit, owing to a slow start to the year at its marine support business.

Fashion retailer Ted Baker nudged 1.6% higher to 926.5p, on announcing that it had agreed to an exclusive licence deal in Japan with Sojitz Infinity.

Book and convenience retailer WH Smith lost 1.5% to £19.64 after it said its travel business continued to grow 'strongly' in the year through August, with sales improvements recorded across all of its channels.

Its weaker high street business, meanwhile, performed as expected, with cost savings and margin improvements delivered to plan, the company added.

AstraZeneca added 26p to £72.66 as it revealed positive results from a clinical trial of a treatment combination for chronic obstructive pulmonary disease.

SMALLER COMPANY NEWS

Specialised technical product supplier Diploma gained 1.5% to £15.76 after if forecast a 13% rise in annual revenue, coupled with an improvement in operating margins.

Online education group Wey Education rallied 13.5% to 10.25p on announcing that its annual adjusted profits would be 'at least' in line with expectations following a jump in revenue.

President Energy slumped 14% to 5.4p, having deferred its 2019 drilling campaign in Argentina after the government introduced caps on fuel prices.

Spend management group Proactis clawed back some of its earlier losses but still ended a miserable day down 4% at 49p after issuing a trading update that spelled out a difficult period for the company. On a brighter note, Proactis did reveal that it had received a number of early expressions of interest from a formal sales process of the company in July.

Proactis also said it expected its revenue for the year through July to rise to £54.1m, up from £52.2m, but its adjusted EBITDA to fall to £15m, down from £17.3m.

Satellite broadband reseller BigBlu Broadband saw its share price nudge 1.5% up to 105p after an update showed growing revenues, profits and recurring income streams, although cash conversion remains in need of improvement. Story provided by StockMarketWire.com
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