London midday: Stocks stay up, sterling slips as BoE split over rates

Thu 07 Nov 2019

LONDON (SHARECAST) - (Sharecast News) - London stocks were still a little higher by midday on Thursday after the Bank of England kept interest rates on hold but with two dissenters, as investors waded through an avalanche of corporate news and welcomed signs of progress in US-China trade relations.
The FTSE 100 was up 0.2% at 7,410.70, while the pound was down 0.2% against the dollar at 1.2824 and 0.3% lower versus the euro at 1.1578 after the BoE left interest rates at 0.75% and kept the asset purchase programme unchanged.

However, two of the nine policymakers- Michael Saunders and Jonathan Haskel - voted in favour of lowering interest rates to 0.5%.

David Cheetham, chief market analyst at XTB, said: "Given the political uncertainty ahead of next month's election it is not at all surprising that the central bank have decided to refrain from any change in policy, but the calls from some members for rate cuts come as something of a surprise and has caused an adverse reaction in the pound."

More broadly, the mood was underpinned by growing hopes over a China-US trade deal after a spokesman from China's Ministry of Commerce said that Beijing and the US had agreed to simultaneously cancel some existing tariffs on each another's goods.

Joshua Mahony, senior market analyst at IG, said: "While a final deal could be signed in December rather than November, the plan to begin rolling back tariffs across the phases does show that we are finally seeing light at the end of the tunnel.

"Unlike the promise of higher agricultural purchases by the Chinese, a roll back in tariffs from each side would be much more positive for the wider economy and less likely to falter due to non-conformity of the agreement."

On the corporate front, there was a veritable deluge of earnings releases for investors to seek their teeth into.

RSA Insurance rallied after it said net written premiums for the year to date were flat but underwriting profit was up "strongly".

Auto Trader gained after the car marketplace reported a rise in first-half profit and revenue and backed its expectations for the year.

Bank of Georgia was a high riser after well-received third-quarter results, while IMI and Provident Financial were also up after updates.

Tate & Lyle rose as it posted a 45% jump in first-half profit as revenue ticked higher, with the food and beverage solutions division putting in a solid performance.

Marks & Spencer was boosted by an upgrade to 'hold' at Societe Generale, while Primark owner Associated British Foods rose after an upgrade to 'buy' at Goldman.

On the downside, Hiscox tanked after JPMorgan downgraded its stance on the shares to 'neutral' and slashed the price target to 1,290p from 1,750p, while SSE was knocked lower by a downgrade to 'hold' at Berenberg.

Senior suffered heavy losses after it announced a restructuring programme amid difficulties in its Flexonics and aerospace markets and said revenue in the aerospace division had been lower than expected in the last four months.

Luxury car maker Aston Martin reversed earlier gains after saying it swung to a third-quarter loss amid "tough" trading conditions.

BP, Card Factory and Softcat were all down as their stock went ex-dividend.

Market Movers

FTSE 100 (UKX) 7,413.41 0.23%
FTSE 250 (MCX) 20,391.36 0.86%
techMARK (TASX) 3,968.72 0.20%

FTSE 100 - Risers

RSA Insurance Group (RSA) 549.60p 3.27%
Persimmon (PSN) 2,350.00p 3.25%
Evraz (EVR) 386.21p 2.77%
Burberry Group (BRBY) 2,127.80p 2.59%
British American Tobacco (BATS) 2,909.00p 2.36%
Glencore (GLEN) 261.95p 1.95%
Anglo American (AAL) 2,108.00p 1.76%
Associated British Foods (ABF) 2,462.00p 1.65%
Auto Trader Group (AUTO) 557.60p 1.60%
Smurfit Kappa Group (SKG) 2,736.00p 1.56%

FTSE 100 - Fallers

Hiscox Limited (DI) (HSX) 1,185.26p -14.67%
Hikma Pharmaceuticals (HIK) 1,992.00p -1.63%
Fresnillo (FRES) 694.20p -1.62%
SSE (SSE) 1,256.00p -1.61%
United Utilities Group (UU.) 838.40p -1.36%
BP (BP.) 507.30p -1.32%
Meggitt (MGGT) 629.20p -1.32%
Severn Trent (SVT) 2,213.00p -1.25%
Polymetal International (POLY) 1,236.50p -1.16%
London Stock Exchange Group (LSE) 6,853.80p -1.13%

FTSE 250 - Risers

Bank of Georgia Group (BGEO) 1,486.53p 9.95%
Wood Group (John) (WG.) 384.10p 8.17%
Marks & Spencer Group (MKS) 194.52p 6.88%
IMI (IMI) 1,131.00p 6.55%
Lancashire Holdings Limited (LRE) 716.00p 6.31%
Ferrexpo (FXPO) 138.95p 6.03%
Tate & Lyle (TATE) 703.00p 5.91%
Virgin Money UK (VMUK) 150.00p 4.68%
Bodycote (BOY) 806.00p 4.34%
IP Group (IPO) 59.18p 4.19%

FTSE 250 - Fallers

Senior (SNR) 177.60p -5.43%
Card Factory (CARD) 166.00p -4.60%
Galliford Try (GFRD) 718.78p -3.13%
Aston Martin Lagonda Global Holdings (AML) 407.52p -2.39%
Beazley (BEZ) 546.00p -1.71%
888 Holdings (888) 155.70p -1.52%
Sirius Real Estate Ltd. (SRE) 74.00p -1.33%
Greencoat UK Wind (UKW) 146.15p -1.25%
Spirent Communications (SPT) 197.60p -1.20%
Centamin (DI) (CEY) 115.30p -1.20%
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