London midday: FTSE falls after Trump presidency but losses limited

The FTSE 100 was in the red on Wednesday after Donald Trump was elected US President but losses were not as severe as expected as pharmaceutical stocks rallied and a US rate hike this year seemed less likely.

“The Trump shock is in, yet markets are remarkably calm,” said IG’s Chris Beauchamp.

“Seemingly everyone predicted financial apocalypse on the back of this event, but canny investors have worked out that the sun will still come up tomorrow even after Donald’s win (although looking at the weather in London that seems hard to believe)."

Strength in pharmaceutical shares, including GlaxoSmithKline, AstraZeneca and Shire, helped to limit losses. A win by Democratic candidate Hillary Clinton was seen as bad for the sector as she had wanted to increase regulation and combat high drug prices.

Analysts Mike van Dulken and Henry Croft at Accendo Markets said a win by Trump sees less chance of an interest rate increase by the Federal Reserve, which “helps keep investors smiling at the prospect of cheap money and accommodative global monetary policy stance for a while longer”.

The pound rose 0.51% against the dollar at $1.2442 while the greenback tumbled 1.97% versus the yen and 0.73% versus the euro.

Meanwhile, gold prices enjoyed their biggest rally since Brexit as the 'risk off' mode took over and investors scurried for safety.

Oil prices wavered with West Texas Intermediate down 0.04% to $44.97 a barrel and Brent crude up 0.26% to $46.16 ahead of weekly crude inventory data from the Energy Information Agency at 1530 GMT.

On the economic data front, the UK trade deficit widened to £5.2bn in September from £3.8bn in August, according the Office for National Statistics. Economists had expected a deficit of £3.9bn.

Exports fell by £0.2bn while imports rose by £1.2bn, with the wider gap driven by a record £8.7bn deficit with the European Union.

While the pound has fallen sharply since the Brexit vote, the ONS said there was little direct evidence so far of its impact on trade.

In China, the consumer price index increased an annualised 2.1% in October, as expected by analysts, following 1.9% growth the previous month, the National Bureau of Statistics said.

The producer price index jumped 1.2% year-on-year compared to just 0.1% in September and estimates of 0.8%, boosted by an increase in the price of industrial commodities, including rising coal prices.

In company news, Sainsbury's shares plunged after it cut its interim dividend 10% as underlying profits fell the same amount despite revenues increasing as the decline in like-for-like sales eased off in recent months.

Burberry was also under the cosh after it said half-year revenues and profit decreased as the luxury fashion house implemented a turnaround plan to cut costs and revamp its products.

Global information services company Experian slumped after the release of its half-year results, with 5% organic revenue growth to $2.24bn, which was in line with its board’s target range.

On the upside, mining stocks gained as metal prices rose with Fresnillo, Randgold Resources and Antofagasta in the black.

Market Movers

FTSE 100 (UKX) 6,796.78 -0.68%
FTSE 250 (MCX) 17,396.20 -0.30%
techMARK (TASX) 3,331.43 0.93%

FTSE 100 - Risers

Fresnillo (FRES) 1,731.00p 8.19%
Ashtead Group (AHT) 1,339.00p 7.81%
Hikma Pharmaceuticals (HIK) 1,777.00p 6.86%
Randgold Resources Ltd. (RRS) 7,215.00p 6.49%
Shire Plc (SHP) 4,813.00p 6.44%
CRH (CRH) 2,818.00p 6.34%
Polymetal International (POLY) 958.00p 5.56%
Antofagasta (ANTO) 612.50p 3.99%
BAE Systems (BA.) 568.50p 3.74%
Wolseley (WOS) 4,400.00p 2.49%

FTSE 100 - Fallers

Sainsbury (J) (SBRY) 241.60p -5.44%
Experian (EXPN) 1,445.00p -4.75%
Marks & Spencer Group (MKS) 318.80p -3.69%
Associated British Foods (ABF) 2,545.00p -3.34%
WPP (WPP) 1,671.00p -3.24%
Micro Focus International (MCRO) 2,006.00p -2.86%
Whitbread (WTB) 3,459.00p -2.73%
Burberry Group (BRBY) 1,441.00p -2.70%
Unilever (ULVR) 3,291.00p -2.69%
Intu Properties (INTU) 266.30p -2.42%

FTSE 250 - Risers

Worldwide Healthcare Trust (WWH) 2,114.00p 8.24%
Centamin (DI) (CEY) 166.20p 7.57%
Hill & Smith Holdings (HILS) 1,137.00p 6.76%
Acacia Mining (ACA) 547.50p 5.69%
Ultra Electronics Holdings (ULE) 1,901.00p 4.74%
Indivior (INDV) 366.60p 4.62%
Petra Diamonds Ltd.(DI) (PDL) 155.60p 4.57%
Hochschild Mining (HOC) 274.90p 4.13%
Balfour Beatty (BBY) 272.30p 3.89%
AO World (AO.) 165.00p 3.77%

FTSE 250 - Fallers

Tate & Lyle (TATE) 680.00p -9.09%
International Personal Finance (IPF) 271.10p -7.60%
Aveva Group (AVV) 1,709.00p -3.72%
Smurfit Kappa Group (SKG) 1,749.00p -3.48%
PZ Cussons (PZC) 321.70p -3.07%
Greencore Group (GNC) 301.40p -3.06%
Templeton Emerging Markets Inv Trust (TEM) 589.00p -2.97%
Inmarsat (ISAT) 768.00p -2.91%
JPMorgan Emerging Markets Inv Trust (JMG) 718.00p -2.71%
Laird (LRD) 131.80p -2.66%