London close: Falling resources, rising sterling, ex-dividends dampen FTSE

Equities in London were held back by big falls among miners as metals prices dropped, and also by a stronger sterling in the aftermath of better than expected UK services data.

A strong UK services purchasing-managers' index (PMI) reading early in the session helped sterling higher, which in turn retarded the FTSE 100. This followed sterling gains after the US Federal Reserve held rates unmoved last night.

The FTSE 100 closed up 0.19% to 7,248.10, and the FTSE 250 erased early losses to end almost perfectly flat at 19,680.81. A long list of ex-dividend stocks weighed on progress from the start of the session.

This was in contrast to the buoyancy across the Channel, where Germany's Dax and France's Cac 40 performed altogether better than the indices in Brexit-divided UK, where 95-year-old Prince Philip today announced his retirement in the autumn from royal duties.

"Mainland European markets have led the way today, as last night's final French election debate seemed to put yet another nail in the coffin of Marine Le Pen's presidential campaign," said Joshua Mahony, market analyst at IG.

"The FTSE has once again suffered at the hands of a buoyant home currency, with the completion of a hat-trick of remarkably strong PMI readings adding further fuel to an already resilient pound."

Michael Hewson, chief market analyst at CMC Markets UK, added that all European markets barring the FTSE 100 had outperformed.

"The FTSE 100 has been the exception, weighed down by an underperforming mining sector, a slide in oil prices, and some concerns about UK retail," he said, as Brent crude falling almost 4% to $48.85 a barrel.

Jasper Lawler, senior market analyst at London Capital Group, was another who said signs from the services industry that the UK economy was not down-and-out just yet had renewed interest in sterling.

In corporate news, Royal Dutch Shell gushed higher as it said first-quarter profit more than doubled. HSBC was firming as its first-quarter profits were hit by currency movements, masking a strong underlying improvement on the year and quarter.

RSA Insurance advanced as it posted a 14% increase in first-quarter net written premiums, while Morrisons gained after its first-quarter sales rose thanks to price cuts and solid trading over Easter.

Randgold Resources spiked in early trade but was in the red by noon despite reporting a 33% jump in first-quarter profit and a rise in gold production.

Fellow miners BHP Billiton and Antofagasta were weighed down as iron ore futures lost up to 7% and copper futures extended losses past 2% in the session.

Glencore was therefore in the red even as it raised its full-year profits target slightly to between $2.3bn and $2.6bn, while Anglo American shares dropped as it agreed the sale of its 88% stake in the Drayton thermal coal mine in New South Wales.

Next was under the cosh after it trimmed the top end of its full-year profits guidance as sales fell in the first quarter of its financial year. Peer Marks & Spencer was dragged down on the implications for the sector.

Convatec was weaker despite reiterating its guidance for 2017 and reporting in-line trading for the first quarter.

Market Movers

FTSE 100 (UKX) 7,250.05 0.21%
FTSE 250 (MCX) 19,674.05 -0.05%
techMARK (TASX) 3,528.47 0.07%

FTSE 100 - Risers

TUI AG Reg Shs (DI) (TUI) 1,164.00p 2.92%
HSBC Holdings (HSBA) 663.70p 2.87%
Admiral Group (ADM) 2,126.00p 2.66%
RSA Insurance Group (RSA) 620.00p 2.65%
3i Group (III) 824.50p 2.61%
International Consolidated Airlines Group SA (CDI) (IAG) 569.50p 2.52%
Hikma Pharmaceuticals (HIK) 1,975.00p 1.86%
Whitbread (WTB) 4,074.00p 1.85%
Burberry Group (BRBY) 1,610.00p 1.77%
Smurfit Kappa Group (SKG) 2,149.00p 1.66%

FTSE 100 - Fallers

Next (NXT) 4,183.00p -5.15%
Anglo American (AAL) 998.30p -4.42%
Antofagasta (ANTO) 754.50p -4.37%
Paddy Power Betfair (PPB) 8,060.00p -3.99%
Kingfisher (KGF) 328.20p -3.78%
Glencore (GLEN) 277.20p -3.35%
BHP Billiton (BLT) 1,117.00p -2.53%
Marks & Spencer Group (MKS) 357.30p -2.51%
Imperial Brands (IMB) 3,617.50p -2.27%
Morrison (Wm) Supermarkets (MRW) 233.70p -2.22%

FTSE 250 - Risers

Mitie Group (MTO) 239.20p 3.42%
G4S (GFS) 325.10p 3.37%
esure Group (ESUR) 266.40p 2.90%
Softcat (SCT) 426.70p 2.50%
OneSavings Bank (OSB) 446.90p 2.27%
Homeserve (HSV) 700.00p 2.26%
Grafton Group Units (GFTU) 766.00p 2.20%
Vesuvius (VSVS) 541.00p 2.08%
SSP Group (SSPG) 450.20p 2.06%
BTG (BTG) 711.00p 2.01%

FTSE 250 - Fallers

Kaz Minerals (KAZ) 439.50p -10.23%
Vedanta Resources (VED) 595.00p -6.67%
Centamin (DI) (CEY) 154.30p -5.45%
Petrofac Ltd. (PFC) 787.50p -4.37%
Ladbrokes Coral Group (LCL) 123.10p -4.13%
Restaurant Group (RTN) 335.10p -4.12%
Hochschild Mining (HOC) 234.60p -4.09%
Hunting (HTG) 528.50p -3.82%
Derwent London (DLN) 2,859.00p -3.74%
Acacia Mining (ACA) 379.30p -3.49%