Hot Features
Premium
Register for real-time alerts, custom portfolio, and market movers
London open: Stocks flat, pound loses ground as Tory lead over Labour narrows
London stocks were steady in early trade while the pound lost ground as the first poll since the Manchester bomb attack showed the Tory lead over Labour narrowing.
The FTSE 100 was flat at 7,520.84, while the pound was down 0.5% versus the dollar and the euro at 1.2876 and 1.1487 respectively, as the latest YouGov/Times poll showed Labour has slashed the Conservatives’ lead to just five points.
Spreadex analyst Connor Campbell said: “Any growth managed by sterling since April has largely been predicated on the assumption that the Conservatives would secure a landslide victory. That this presently doesn’t seem to be the case has helped further erode confidence in the currency’s current position.”
Meanwhile, oil prices reversed heavy losses to trade higher, with West Texas Intermediate up 0.3% to $49.05 a barrel and Brent crude up 0.5% to $51.74. Prices had fallen sharply after the Opec meeting in Vienna resulted in a nine-month extension of the previously agreed 1.8m barrel-a-day production cut.
CMC Markets analyst Michael Hewson said; “The rise in oil prices that we’d seen this month in the lead up to this week’s OPEC meeting came to an abrupt and shuddering halt yesterday in the wake of the expected announcement that members, as well as non OPEC members, had agreed to extend the cuts agreed in November last year for another 9 months, until March 2018.
“The resultant market sell-off shouldn’t really have been too much of a surprise given that having delivered on expectations, markets didn’t really have anywhere else to go.”
In corporate news, Informa was the top riser after it reiterated its full-year expectations and said first-quarter trading in Global Exhibitions remains strong, while trading in the events business is steady.
The Restaurant Group surged after a first-quarter trading update which showed like-for-like sales fell 1.8%. The update prompted JPMorgan Cazenove to upgrade the stock to ‘overweight’ from ‘neutral’, as it said the company “has had a better start to 2017 than many in the market may have expected”.
Hammerson nudged up after saying it has exchanged contracts for the sale of two retail parks to clients of BMO Real Estate Partners for £80m, while Spirax-Sarco Engineering rallied as it agreed to buy US-based electrical products provider Chromalox from Irving Place Capital for a cash-free, debt-free consideration of $415m (£319m).
FTSE 250 hospital group Spire Healthcare was also in the black as it said trading from 1 January to 25 May has been in line with expectations and reiterated its 2017 guidance.
On the downside, Intertek was in the red despite posting a 14% jump in revenues for the first four months of the year and saying it was on track to deliver its 2017 targets.
There are no major UK data releases due but in the US, first-quarter GDP is at 1330 BST.
