London open: Stocks edge lower but Wetherspoons rallies on results
London stocks were lower in early trade on Friday, but losses were contained as investors reacted fairly calmly to news that North Korea had fired another ballistic missile over Japan, with some cheer in the form of bubbly results from pub operator JD Wetherspoon.
At 0830 BST, the FTSE 100 was down 0.4% to 7,269.29, while the pound was 0.2% firmer against the euro and the dollar at 1.1259 and 1,3424, respectively, having shot higher on Thursday after the Bank of England signalled that it would lift rates sooner than forecast.
The missile from North Korea was said to have travelled 3,700km before landing in the sea off Hokkaido, flying further and higher than the one fired over Japan last month. The launch comes just days after the UN Security Council approved fresh sanctions against Pyongyang for its nuclear test on 3 September.
Spreadex analyst Connor Campbell said: “These North Korea missile launches seems to be following the law of diminishing returns – at least market-wise with the latest provocation from Pyongyang greeted with something of a shrug from investors.”
There are no major UK data releases due but in the US, retail sales are at 1330 BST, while University of Michigan consumer sentiment is at 1500 BST.
On the corporate front, JD Wetherspoon surged after it served up a potent 43% shot of earnings growth and a passionate diatribe about Brexit from founder and chairman Tim Martin. On like-for-like sales that rose 4.0% in the 53 weeks to 30 July, profit before tax and exceptional items increased 13.7% to £76.4m and earnings per share to 69.2p.
JD Sports Fashion edged higher after announcing a joint venture agreement with South Korean footwear retailer, Shoemarker Inc, in relation to its J&S Partners unit, which currently trades as Hot-T. The company has bought an initial 15% of Hot-T for a cash consideration of around £5.5m.
Indivior gained ground after saying it has launched patent infringement lawsuits against Dr Reddy’s, Actavis, Par, Alvogen, Teva, and Mylan over generic versions of its opioid addiction treatment Suboxone.
Shares in Coca‑Cola HBC slipped as it said that chief executive officer Dimitris Lois will be taking a temporary leave of absence from the company in order to undergo treatment for a medical condition.
GlaxoSmithKline nudged down despite saying it had received a “positive opinion” for its Trelegy Ellipta treatment for chronic obstructive pulmonary disease from the European Medical Authority’s Committee for Medicinal Products for Human Use.
Petrofac gushed higher after RBC Capital Markets upped its stance on the oilfield services provider to ‘sector perform’ from ‘underperform’, but Carnival was hit by a downgrade to ‘neutral’ from Credit Suisse, which removed the stock from its ‘focus list’.
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