LONDON MARKETS: London Markets Inch Up; Flat As Weaker Pound Fails To Support FTSE; Just Eat Drops 4%
06 März 2019 - 3:12PM
Dow Jones News
By Emily Horton
British American Tobacco leads the gainers
London markets inched up Wednesday, lifted by a weaker pound and
a sizeable gain for British American Tobacco PLC.
How are markets performing?
The FTSE 100 rose 0.3% to 7,203.39 after finishing up 0.7% on
Tuesday.
Meanwhile, the pound fell to $1.3140 from $1.3177 late in New
York on Tuesday.
What's driving the markets?
Global investors were sitting on their hands, waiting for more
signals on the global trade front. The FTSE 100 shook off a modest
earlier loss, with a positive surprise coming from a rebound in the
services purchasing managers index, which rose to 51.3 from a prior
50.1.
The index picked up gains throughout the day, feeding off a
strong pound, which was weighed by dollar strength and Brexit
nervousness. In a note to clients, Michael Hewson, chief market
analyst at CMC Markets, said skepticism was growing that "we might
see another delay to any vote on changes to Prime Minister May's
deal, as MPs continue to steer away in coming out in support of it,
and lean more to the possibility of an article 50 extension."
Meanwhile, the Organization for Economic Cooperation and
Development
(http://www.marketwatch.com/story/oecd-cuts-global-growth-forecast-cites-china-worries-and-weakening-european-economy-2019-03-06)
became the latest to ring alarm bells over Brexit, with projections
for the economy to grow 0.8% in 2019, "just shy of half the already
paltry 1.4% posted last year," noted Connor Campbell, financial
analyst at SpreadEx, in a note to clients.
"And that's with a deal; without and the OECD warned the UK
could plunge into a recession that would 'generate sizeable
negative spillovers on growth in other countries,'" said
Campbell.
What stocks are active?
Online food-deliver company Just Eat PLC(JE.LN) fell by 1%
reporting a 44% gain in sales, but outlining higher delivery costs
in the group's earnings
(http://www.marketwatch.com/story/just-eat-swings-to-profit-sees-more-growth-in-19-2019-03-06).
"Just Eat are trying to work with the same sort of branded
restaurants their rivals are targeting, and offering their own
delivery offering. None of this comes cheaply, and the costs are
holding profits back." Steve Clayton, manager of the Hargreaves
Lansdown's select funds, said in a client note.
Legal & General Group PLC (LGEN.LN) lost close to 4%,
despite announcing a profit rise in 2018
(http://www.marketwatch.com/story/legal-general-profit-rises-in-2018-2019-03-06).
"Shares have slid back from three year highs in early trading, no
doubt due to some profit taking, after a 24% rise from the lows we
saw in December," said CMC's Hewson.
Luxury fashion group Burberry PLC (BRBY.LN) fell by 4%.
Meanwhile, British American Tobacco PLC (BATS.LN) added 4%
reclaiming some of its loses after Monday's dip, while in Tullow
Oil PLC(TLW.LN) rose 3%.
(END) Dow Jones Newswires
March 06, 2019 08:57 ET (13:57 GMT)
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