London midday: FTSE extends losses as energy firms retreat

London stocks had fallen further into the red by midday on Tuesday, with oil giants under pressure as oil prices retreated.

The FTSE 100 was down 0.6% at 8,216.10.

Russ Mould, investment director at AJ Bell, said: "The FTSE 100 started Tuesday in negative territory amid signs of US economic weakness and mixed trading in Asia.

"Also not helping matters was a fall in oil prices, as OPEC’s surprise decision to start rolling back some of its production cuts before the end of the year hit the market. Index heavyweights BP and Shell, as well as other resources names, were on the back foot.

"News of slowing activity in US factories is a double-edged sword as it could provide the Federal Reserve with more room for manoeuvre on interest rates. Job openings data later today could reveal if a softening economy is being reflected in looser labour market conditions. Friday’s non-farm payrolls release is also in focus as investors await the latest decision from the Federal Reserve next week."

On home shores, investors were mulling industry data showing that retail sales inched higher in May, staging a minor rebound after a disappointing performance in April.

According to figures from the British Retail Consortium and KPMG, total sales were up 0.7% year-on-year last month, following a 4.0% annual decline in April, as a 3.6% increase in food sales managed to outweigh a 2.4% decline in non-food.

While non-food sales were down, the BRC noted that the two bank holidays in May helped drive growth in purchases of DIY and gardening equipment, as well as clothing, while computing sales reached their highest levels since the pandemic.

The overall growth rate was higher than the three-month average of 0.3%, but still came in below the 12-month average gain of 2.0%.

"Despite a strong bank holiday weekend for retailers, minimal improvement to weather across most of May meant only a modest rebound in retail sales last month," said the BRC's chief executive Helen Dickinson.

"Retailers remain optimistic that major events such as the Euros and the Olympics will bolster consumer confidence this summer," she said.

In equity markets, British American Tobacco lost ground as it reported a drop in first-half underlying revenues and adjusted profits.

Standard Chartered was under the cosh as the bank was accused of carrying out billions of dollars of transactions for funders of terrorist groups such as Hamas.

Chemring ticked down as it hailed a record interim order book but posted a drop in underlying profit as its Tennessee countermeasures business was hit by adverse weather conditions.

On the upside, Tritax Eurobox rallied after Brookfield Asset Management said it was in the early stages of assessing a possible cash offer for the company. Tritax confirmed in a statement late on Monday that it had not received a proposal from Brookfield.

Carnival cruised higher after an upgrade to ‘buy’ at Peel Hunt.

Market Movers

FTSE 100 (UKX) 8,216.10 -0.56%
FTSE 250 (MCX) 20,697.59 -0.97%
techMARK (TASX) 4,817.70 -0.40%

FTSE 100 - Risers

Melrose Industries (MRO) 628.00p 2.25%
Severn Trent (SVT) 2,409.00p 2.21%
National Grid (NG.) 905.40p 2.19%
United Utilities Group (UU.) 1,021.00p 1.49%
Unilever (ULVR) 4,367.00p 1.39%
Smith & Nephew (SN.) 995.60p 1.16%
London Stock Exchange Group (LSEG) 9,254.00p 1.14%
Marks & Spencer Group (MKS) 309.40p 1.08%
Entain (ENT) 713.00p 1.08%
easyJet (EZJ) 479.90p 0.95%

FTSE 100 - Fallers

Ocado Group (OCDO) 355.30p -7.16%
Fresnillo (FRES) 592.00p -3.97%
BP (BP.) 462.75p -3.83%
Standard Chartered (STAN) 747.00p -3.79%
St James's Place (STJ) 503.50p -3.73%
Anglo American (AAL) 2,411.00p -3.68%
Antofagasta (ANTO) 2,146.00p -3.12%
Rolls-Royce Holdings (RR.) 448.80p -2.63%
Glencore (GLEN) 469.80p -2.43%
CRH (CDI) (CRH) 6,096.00p -2.37%

FTSE 250 - Risers

Carnival (CCL) 1,150.00p 5.12%
W.A.G Payment Solutions (WPS) 71.40p 3.18%
Watches of Switzerland Group (WOSG) 421.60p 1.74%
Future (FUTR) 1,112.00p 1.18%
Tritax Big Box Reit (BBOX) 164.10p 1.17%
Tritax Eurobox (GBP) (EBOX) 60.60p 1.17%
Baltic Classifieds Group (BCG) 244.50p 0.82%
Trustpilot Group (TRST) 215.00p 0.70%
TUI AG Reg Shs (DI) (TUI) 579.50p 0.70%
Octopus Renewables Infrastructure Trust (ORIT) 72.80p 0.69%

FTSE 250 - Fallers

JPMorgan Indian Investment Trust (JII) 933.00p -3.91%
Energean (ENOG) 1,127.00p -3.59%
Pacific Horizon Inv Trust (PHI) 605.00p -3.51%
4Imprint Group (FOUR) 6,200.00p -3.43%
Quilter (QLT) 118.80p -3.41%
Ithaca Energy (ITH) 129.90p -3.20%
Diversified Energy Company (DEC) 1,123.00p -3.19%
IP Group (IPO) 52.30p -3.15%
Abrdn (ABDN) 151.60p -2.94%
Auction Technology Group (ATG) 531.00p -2.93%