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London Open: Stocks Steady But Whitbread Slumps On Disappointing Interims
London stocks were steady in early trade, but leisure sector giant Whitbread slid after a disappointing set of interim results.
At 0840 BST, the FTSE 100 was flat at 7,525.23, while the pound was down 0.1% against the euro and the dollar to 1.1220 and 1.3187, respectively.
Spreadex analyst Connor Campbell said: “It was another predictably slow start for the markets this Tuesday, though mercifully not as sluggish as on Monday.
“Despite the pound slipping 0.1% against both the dollar and the euro, with the currency suffering on Bank of England deputy governor Jon Cunliffe claiming a November rate hike is an ‘open question’, the FTSE couldn’t find its way to any significant growth this morning.”
Speaking on a trip to Wales, Cunliffe told the Western Mail that while interest rates are sure to be higher in three years’ time, there’s no guarantee that the first hike in a decade is imminent.
There are no major UK data releases due on Tuesday, but Wednesday sees the release of third-quarter GDP data and mortgage approvals numbers.
In corporate news, Whitbread was under the cosh after first-half results showed evidence of a bit of a summer slowdown, with revenues at its Premier Inn hotels and Costa Coffee arms both softening but tight cost control percolating through to a solid profit performance.
St James’s Place edged higher as it posted £2.36nbn of net inflows of new funds under management for the three months to the end of September compared to £1.66bn in the same period one year ago.
Saga was also in the black as it said chairman Andrew Goodsell intends to retire next year, while distribution and outsourcing group Bunzl gained some ground after it reported a rise in third-quarter revenue as it continues to eye further acquisitions.
International service company Serco rallied as it reached agreement to acquire BTP Systems – a provider of satellite communication and radar engineering technical services to the US defence industry and signed heads of terms to acquire a portfolio of selected UK health facilities management contracts from Carillion.
Oil services group Hunting gushed higher after saying it expects a modest profit for the year as revenue rose in third quarter.
Carillion surged after agreeing to sell a large part of its UK healthcare facilities management business to Serco for £50.1m, and announcing new financing and contract wins.
Weir advanced as RBC Capital Markets lifted it to ‘outperform’, while Pendragon fell again after its profit warning on Monday, as Berenberg and Liberum downgraded their ratings on the stocks.
RSA Insurance was boosted by an upgrade to ‘overweight’ at JPMorgan, but Admiral and Esure were hit by downgrades from the same outfit.
