London open: Stocks edge higher as China PMI lifts mining sector

Thu 31 Aug 2017

LONDON (SHARECAST) - (ShareCast News) - London stocks edged higher in early trade on Thursday, taking their cue from an upbeat session in the US, with sentiment underpinned by a better-than-expected reading on the Chinese manufacturing sector.
At 0825 BST, the FTSE 100 was up 0.3% to 7,384.57, while the pound was down 0.3% versus the euro at 1.0849 and 0.1% against the dollar at 1.2917.

China's official manufacturing purchasing managers' index for August printed at 51.7, up a touch from 51.4 in July and above expectations for a nudge down to 51.3. A reading above 50 indicates expansion.

Analysts at Accendo Markets said: "This is some welcome good news from Asia following recent geopolitical woes, building on yesterday's solid US GDP/ADP prints, compounding risk appetite at the continued expense of safe havens."

The data helped to boost the mining sector, which is heavily dependent on demand from China, with Antofagasta, Anglo American and Rio Tinto among the top risers.

Elsewhere, Restaurant Group surged as the Frankie & Benny's and Garfunkel's owner held its dividend flat as, despite sales deteriorating as the first half of the year wore on, it reported early signs of improvement and broke back into the black. Many analysts had been expecting the company to warn on profits again.

Building materials distributor Grafton added a few pennies after it said interim pre-tax profits rose 18% to 74.1m, but it warned that recent softer trends in the UK economy are likely to be sustained over the remainder of the year.

Ladbrokes was on the gallop after it reported a strong start to the year and a 7% jump in first-half operating profit.

Recruiter Hays pushed higher as it posted a rise in full-year profit and announced its first special dividend following a solid performance in Europe and a stabilisation in the UK.

Serco was boosted by an upgrade from UBS, while Provident Financial slipped after Jefferies downgraded its stance on the sub-prime lender.

Melrose Industries suffered heavy losses despite saying it returned to profit in the first half of the year, while British American Tobacco nudged lower after announcing a series of management changes.

Redefine was also in the red after saying it has completed on the sale of the Sytner BMW showroom in High Wycombe for 26.1m to an unnamed UK pension fund.

Ultra Electronics retreated after saying it has expanded its relationship with Jupitor Corporation of Japan to support the introduction of its latest technologies on major Japanese aerospace programmes, while Jimmy Choo slipped a touch despite reporting a 174% jump in first-half profit.

G4S, Hammerson, St James's Place, Croda, Stagecoach, Auto Trader and Wood Group were all providing a drag as their stock went ex-dividend.

There are no major UK data releases due on Thursday so market participants will be turning their attention to the US, where the PCE, jobless claims, pending home sales and the Chicago purchasing managers' index are all due ahead of Friday's non-farm payrolls report. There is also the last euro area inflation data before the European Central Bank's much anticipated meeting on 7 September.

Market Movers

FTSE 100 (UKX) 7,384.57 0.26%
FTSE 250 (MCX) 19,652.20 0.18%
techMARK (TASX) 3,389.80 0.13%

FTSE 100 - Risers

Antofagasta (ANTO) 1,036.00p 2.07%
Mediclinic International (MDC) 754.50p 1.55%
Anglo American (AAL) 1,381.50p 1.28%
Rio Tinto (RIO) 3,725.00p 1.25%
CRH (CRH) 2,698.00p 1.12%
Smurfit Kappa Group (SKG) 2,339.00p 1.12%
easyJet (EZJ) 1,194.00p 1.02%
Centrica (CNA) 197.30p 0.92%
Glencore (GLEN) 359.95p 0.91%
BHP Billiton (BLT) 1,467.00p 0.86%

FTSE 100 - Fallers

G4S (GFS) 285.10p -2.66%
Hammerson (HMSO) 555.00p -1.77%
Provident Financial (PFG) 881.00p -1.23%
Standard Life Aberdeen (SLA) 424.50p -1.23%
St James's Place (STJ) 1,156.00p -1.20%
Tesco (TSCO) 180.30p -1.15%
Royal Mail (RMG) 386.70p -0.97%
Croda International (CRDA) 3,832.00p -0.70%
Randgold Resources Ltd. (RRS) 7,865.00p -0.51%
Land Securities Group (LAND) 996.00p -0.35%

FTSE 250 - Risers

Restaurant Group (RTN) 339.00p 6.57%
Serco Group (SRP) 115.20p 6.08%
Kaz Minerals (KAZ) 848.00p 2.91%
Grafton Group Units (GFTU) 796.00p 2.38%
Evraz (EVR) 321.50p 1.90%
Acacia Mining (ACA) 208.30p 1.81%
FDM Group (Holdings) (FDM) 926.00p 1.76%
Millennium & Copthorne Hotels (MLC) 458.60p 1.73%
Dixons Carphone (DC.) 178.60p 1.65%
TP ICAP (TCAP) 471.60p 1.53%

FTSE 250 - Fallers

Stagecoach Group (SGC) 165.10p -4.18%
Melrose Industries (MRO) 223.60p -2.49%
Auto Trader Group (AUTO) 343.40p -1.89%
Wood Group (John) (WG.) 557.50p -1.68%
Elementis (ELM) 271.30p -1.24%
Workspace Group (WKP) 865.50p -1.20%
Ultra Electronics Holdings (ULE) 1,843.00p -1.18%
Sanne Group (SNN) 750.50p -1.12%
Petrofac Ltd. (PFC) 409.10p -1.06%
NMC Health (NMC) 2,684.00p -1.03%
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