London close: Footsie finishes lower as trade concerns, ex-dividends drag

Thu 28 Nov 2019

LONDON (SHARECAST) - (Sharecast News) - London stocks remained in the red at the close on Thursday, amid concerns about trade relations between the US and China, while ex-dividends were a drag.
The FTSE 100 ended the session down 0.18% at 7,416.43, although the FTSE 250 managed to keep its head above water and close 0.33% higher at 21,023.55.

In currencies, the pound was last 0.13% weaker against the dollar at $1.2904 and off 0.2% against the euro at €1.1724.

Sterling had rallied overnight, after the MRP YouGov poll - the same poll that predicted the outcome of the 2017 election - suggested that the Conservatives were on track for a 68-seat majority.

"It's easy to overstate the importance of this poll but as it backs up every other poll, the picture looks quite clear now," said Neil Wilson, chief market analyst at

"However, the margins in many seats is very narrow and complacent Tory voters could stay home."

Wilson said the majority could be "much smaller" than the poll predicted, and the result could be a hung parliament.

"Betting markets will be mis-pricing the result for sure.

"As politicians are wont to say, there's only one poll that matters."

More broadly, sentiment took a hit after US President Donald Trump signed into law legislation that backs pro-democracy protesters in Hong Kong - a move that will likely strain US relations with China further as the two nations work towards an agreement on trade.

Trump signed the Hong Kong Human Rights and Democracy Act of 2019 into law on Wednesday, along with another bill banning the sale of munitions to Hong Kong police.

China was quick to condemn the move, with the country's Ministry of Foreign Affairs saying that the bill revealed "sinister intentions" on the part of the US towards the people of China and Hong Kong.

"Donald Trump's decision to sign into law the pro-activist Hong Kong bill signals a further toughening in the US stance towards Chinese interests," said IG analyst Joshua Mahony.

"The possibility of sanctions in the event of human rights abuses in Hong Kong signals a willingness to stand against the Chinese at a time when markets are hoping for the two sides to find common ground to agree a phase one trade deal.

"The notion that such a deal is imminent appears to be dubious given this latest step, yet the weakness we are currently seeing for stocks will likely fade as the topic moves out of the headlines."

The mood was dented further after the editor of Chinese state-run media outlet Global Times tweeted that China was considering putting those who drafted the US law supporting pro-democracy protesters in HK on a no-entry list that would bar them from China, Hong Kong and Macau.

On home shores, investors pored over the latest survey from Nationwide, which showed that house prices grew more than expected in November, hitting a seven-month high but remaining "subdued".

House prices were up 0.5% on the month, which was an improvement on 0.2% growth in October and better than expectations of a 0.1% increase.

On the year, house prices rose 0.8% in November, up from 0.4% the month before and ahead of expectations of 0.2% growth.

The data also marked the strongest jump since April.

"Indicators of UK economic activity have been fairly volatile in recent quarters, but the underlying pace of growth appears to have slowed as a result of weaker global growth and an intensification of Brexit uncertainty," said Nationwide's chief economist, Robert Gardner.

"To date, the slowdown has largely centred on business investment, while household spending has been more resilient."

In equity markets, broker notes were having a big impact, with equipment rental firm Ashtead falling 2.17% after a downgrade to 'hold' at HSBC.

Johnson Matthey was off 0.66% after a downgrade to 'underweight' at JPMorgan and as its stock went ex-dividend, while Melrose Industries was 0.34% weaker after a downgrade to 'outperform' from 'top pick' at RBC Capital Markets.

Online gaming and sports betting software company Playtech suffered heavy losses, finishing the session off 5.28% after a downgrade by Morgan Stanley.

Ex-dividends weighed, with Vodafone down 3.91%, IAG off 1.68%, National Grid 1.1% weaker, Severn Trent slipping 0.48%, and Micro Focus ending the day 2.96% lower.

On the upside, British Land was up 1.36%, Land Securities added 2.92% and Great Portland Estates was ahead 1.17%, after upgrades to 'overweight' at Morgan Stanley.

Phoenix Group was 1.5% higher as it said in a trading update that 2019 cash generation was ahead of target.

Virgin Money racked up strong gains, finishing the day up 18.88% even after it said full-year losses widened and scrapped its dividend.

Analysts were said to be focusing on improvements to the net interest margin and capital position.

Market Movers

FTSE 100 (UKX) 7,416.43 -0.18%
FTSE 250 (MCX) 21,023.55 0.33%
techMARK (TASX) 4,113.05 -0.25%

FTSE 100 - Risers

Ocado Group (OCDO) 1,208.00p 3.60%
St James's Place (STJ) 1,119.00p 1.96%
Land Securities Group (LAND) 964.80p 1.67%
Lloyds Banking Group (LLOY) 62.69p 1.60%
Phoenix Group Holdings (PHNX) 744.40p 1.50%
Whitbread (WTB) 4,698.00p 1.42%
British Land Company (BLND) 582.20p 1.36%
Next (NXT) 6,920.00p 1.32%
Tesco (TSCO) 237.20p 1.24%
Reckitt Benckiser Group (RB.) 6,115.00p 1.12%

FTSE 100 - Fallers

Vodafone Group (VOD) 154.16p -3.91%
National Grid (NG.) 896.00p -2.87%
Ferguson (FERG) 6,840.00p -2.34%
Severn Trent (SVT) 2,285.00p -2.18%
Ashtead Group (AHT) 2,391.00p -2.17%
Antofagasta (ANTO) 886.00p -2.12%
London Stock Exchange Group (LSE) 6,898.00p -1.82%
International Consolidated Airlines Group SA (CDI) (IAG) 563.20p -1.68%
Coca-Cola HBC AG (CDI) (CCH) 2,580.00p -1.53%
Evraz (EVR) 369.20p -1.49%

FTSE 250 - Risers

Virgin Money UK (VMUK) 170.00p 18.88%
CLS Holdings (CLI) 291.50p 5.81%
FDM Group (Holdings) (FDM) 967.00p 5.80%
TI Fluid Systems (TIFS) 236.00p 5.59%
Airtel Africa (AAF) 78.15p 4.97%
Finablr (FIN) 194.00p 4.92%
Watches of Switzerland Group (WOSG) 338.80p 4.83%
Pets at Home Group (PETS) 259.80p 4.76%
Grainger (GRI) 292.20p 3.69%
Greencore Group (GNC) 248.20p 3.35%

FTSE 250 - Fallers

Future (FUTR) 1,356.00p -7.05%
Playtech (PTEC) 378.30p -5.28%
GVC Holdings (GVC) 850.20p -4.36%
Go-Ahead Group (GOG) 2,208.00p -3.07%
Micro Focus International (MCRO) 1,114.40p -2.96%
Kainos Group (KNOS) 604.00p -2.88%
Aston Martin Lagonda Global Holdings (AML) 571.80p -2.56%
Syncona Limited NPV (SYNC) 223.00p -2.42%
Electrocomponents (ECM) 657.20p -2.28%
Energean Oil & Gas (ENOG) 906.00p -2.27%
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