London close: Stocks in the red as Yellen keeps mum on policy

Fri 25 Aug 2017

LONDON (SHARECAST) - (ShareCast News) - London stocks slipped into the red just before the end of trading on Friday, with strength in Sterling more than offsetting solid performances from Provident Financial and Computacenter.

At the closing bell, the FTSE 100 was down 0.08% or 5.60 points to 7,401.46 and the FTSE 250 by 0.20% or 38.97 points at 19,671.33, while the pound was up 0.59% versus the dollar at 1.2876 and 0.03% lower against the euro at 1.0845.

European markets were a fairly mixed picture with the DAX down 0.11% to 12,167.94, the CAC 40 lower 0.17% to 5,104.33 and the IBEX 35 firmer at 10,358.20.

In an eagerly awaited speech, the head of the US central bank failed to provide any further clues as to her near-term views on monetary policy.

Similarly, she made no mention of whether stockmarkets had become too frothy, which some market watchers had expected, focusing instead on defending post-crisis financial regulations in the States.

As a result, the US dollar come off sharply, boosting both the pound and the euro against the US dollar.

Neil Wilson, senior market analyst at ETX Capital, said: "The speech offered nothing on the two big questions facing traders - the path of short term rates and the pace of balance sheet reduction. Apparently this is seen as dovish although with zero detail it's hard to really say either way. What were markets expecting? Perhaps some signal about another hike, but given there was no mention it's really a push to describe these remarks any dovish. Sometimes the market just operates on fumes, and this is probably a good case in point."

On the corporate front, troubled doorstep lender Provident Financial rallied after it announced that it has replaced the managing director of its consumer credit division, appointing Chris Gillespie "with immediate effect". Gillespie takes over from Andy Parkinson, the company said in a statement. Shares in Provident tanked by 66% on Tuesday after an unexpected profit warning and the resignation of chief executive Peter Crook.

FTSE 250 IT services provider Computacenter surged 15.55% after it reported a 15% jump in first-half revenue thanks in part to favourable currency movements and an "outstanding" performance in its German business, and said it remains on track for a record performance in 2017. It also said it expects to return around 100m to shareholders in the fourth quarter.

Direct Line was boosted by an upgrade to 'outperform' at Exane BNP Paribas, while Shire was given a shot in the arm by an initiation to 'buy' at Kepler Cheuvreux. However, Renishaw was weaker on the back of a downgrade to 'sell' at Investec.

Elsewhere, the results of a survey released earlier showed UK consumer sentiment ticked higher in August as Britons felt more secure about their security and grew more positive on the outlook for home prices. YouGov/Cebr's consumer confidence index rose from 107.2 in July to 107.6 this month.

Yet households' perception of their finances worsened for a fifth month running, the longest such stretch since the survey began.

"Although this month's consumer confidence figures bring good news, they have to be placed in context - they have not yet returned to where they were ahead of the election," said YouGov analyst Stephen Harmston.

Market Movers

FTSE 100 (UKX) 7,401.46 -0.08%
FTSE 250 (MCX) 19,671.33 -0.20%
techMARK (TASX) 3,391.31 0.06%

FTSE 100 - Risers

Provident Financial (PFG) 916.00p 22.46%
Shire Plc (SHP) 3,750.00p 1.49%
BHP Billiton (BLT) 1,437.00p 1.41%
Standard Life Aberdeen (SLA) 441.60p 1.21%
Old Mutual (OML) 210.10p 1.20%
Pearson (PSON) 621.50p 1.14%
Micro Focus International (MCRO) 2,314.00p 1.05%
Next (NXT) 4,143.00p 0.95%
Anglo American (AAL) 1,339.50p 0.87%
St James's Place (STJ) 1,189.00p 0.85%

FTSE 100 - Fallers

CRH (CRH) 2,720.00p -2.61%
Paddy Power Betfair (PPB) 6,805.00p -2.02%
Worldpay Group (WPG) 419.00p -1.99%
Land Securities Group (LAND) 990.50p -1.84%
Tesco (TSCO) 184.20p -1.73%
WPP (WPP) 1,437.00p -1.71%
SSE (SSE) 1,404.00p -1.68%
Admiral Group (ADM) 1,932.00p -1.68%
Rentokil Initial (RTO) 294.40p -1.44%
Centrica (CNA) 197.20p -1.35%

FTSE 250 - Risers

Computacenter (CCC) 1,018.00p 15.55%
Carillion (CLLN) 49.72p 5.81%
Petra Diamonds Ltd.(DI) (PDL) 97.60p 5.51%
Greencore Group (GNC) 199.90p 5.21%
Hikma Pharmaceuticals (HIK) 1,288.00p 4.12%
Coats Group (COA) 79.50p 3.45%
CLS Holdings (CLI) 215.40p 2.67%
Syncona Limited NPV (SYNC) 162.80p 1.75%
Morgan Advanced Materials (MGAM) 300.00p 1.69%
Just Group (JUST) 152.50p 1.67%

FTSE 250 - Fallers

Hunting (HTG) 402.10p -5.88%
Restaurant Group (RTN) 322.90p -5.14%
Unite Group (UTG) 664.00p -2.64%
IP Group (IPO) 117.10p -2.53%
Pershing Square Holdings Ltd NPV (PSH) 1,045.00p -2.34%
Rank Group (RNK) 224.80p -2.26%
Assura (AGR) 65.50p -2.17%
Capital & Counties Properties (CAPC) 265.30p -2.10%
SIG (SHI) 172.50p -2.04%
Safestore Holdings (SAFE) 411.30p -1.95%
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