London midday: Stocks maintain losses as IAG flies lower; Petrofac news keeps coming

London stocks were still in the red by midday, with IAG under pressure following an IT outage at British Airways that has caused three days of disruptions for passengers.

The FTSE 100 was down 0.4% to 7,517.03, while in Continental Europe, the main benchmark Stoxx 600 was down 0.2% amid concerns about an early election in Italy and the possibility that Greece might forego its next bailout payment.

Meanwhile, the pound was up 0.2% against the dollar at 1.2863 as the latest Survation poll revealed that the Tory lead over Labour has dropped to six percentage points.

In corporate news, British Airways parent International Consolidated Airlines slumped following an IT outage at BA that led to a weekend of chaos and cancellations. BA's IT systems are now up and running and the airline said it will be operating a full flight schedule at Heathrow and Gatwick.

IG analyst Chris Beauchamp said; "IAG shareholders can’t have had a peaceful open this morning, watching anxiously to see how the shares fared as the market got its first chance to react to the weekend’s IT chaos."

"Given that, as of Friday, the shares had risen nearly 40% this year, it is surprising that the profit taking has been confined to a 3% drop, but with the operating margin at its strongest in several years and forward earnings per share seeing some of the best growth in the industry this might be a good chance to buy some more, especially given the improving economic outlook and the near-4% dividend yield."

Royal Bank of Scotland was also in the red after a group of investors agreed on Monday to settle with the bank over claims they were misled about its health before it launched a £12bn rights issue back in 2008.

CLS Holdings reversed course to trade lower after announcing the acquisition of a multi-let office property in Dortmund Germany, for €35.6m after costs from an unnamed US investment manager.

On the upside, London Stock Exchange Group nudged up as it struck a deal to buy US bank Citigroup's fixed income indices and analytics businesses for $685m (£535m) cash, while Allied Minds was on the front foot as it made Jill Smith's appointment as chief executive permanent, having hired her on an interim basis in March.

Anglo American edged higher after saying it has completed the sale of its 83.33% interest in the Dartbrook coal mine located in the Hunter Valley, New South Wales, Australia, to Australian Pacific Coal.

Oilfield services company Petrofac gushed higher as it said it has agreed the extension of a revolving credit facility and despite news that it is facing a potential legal claim from a litigation-funding specialist based on allegations it misled investors over a bribery and money laundering scandal that has seen its shares lose half their value.

Bentham Ventures, which is backed by activist Elliott Management, said that it was "contemplating funding legal proceedings" against Petrofac on behalf of shareholders who have bought share before 12 May, when the Serious Fraud Office confirmed it was investigating the group.

Market Movers

FTSE 100 (UKX) 7,517.03 -0.41%
FTSE 250 (MCX) 19,984.48 -0.20%
techMARK (TASX) 3,617.68 -0.36%

FTSE 100 - Risers

3i Group (III) 876.00p 0.86%
Wolseley (WOS) 5,030.00p 0.84%
Associated British Foods (ABF) 2,974.00p 0.81%
Glencore (GLEN) 294.65p 0.74%
RSA Insurance Group (RSA) 624.50p 0.73%
Legal & General Group (LGEN) 251.60p 0.52%
Smiths Group (SMIN) 1,590.00p 0.51%
British Land Company (BLND) 634.50p 0.48%
TUI AG Reg Shs (DI) (TUI) 1,174.00p 0.43%
DCC (DCC) 7,320.00p 0.41%

FTSE 100 - Fallers

Mediclinic International (MDC) 784.00p -3.92%
International Consolidated Airlines Group SA (CDI) (IAG) 597.00p -2.77%
Informa (INF) 671.00p -2.54%
Fresnillo (FRES) 1,550.00p -1.96%
Old Mutual (OML) 192.90p -1.88%
Paddy Power Betfair (PPB) 8,160.00p -1.86%
British American Tobacco (BATS) 5,491.00p -1.79%
Randgold Resources Ltd. (RRS) 7,085.00p -1.60%
BT Group (BT.A) 309.10p -1.50%
Intertek Group (ITRK) 4,233.00p -1.44%

FTSE 250 - Risers

Petrofac Ltd. (PFC) 407.80p 4.83%
Sophos Group (SOPH) 453.30p 3.78%
Restaurant Group (RTN) 359.40p 2.51%
Wizz Air Holdings (WIZZ) 2,340.00p 2.41%
Assura (AGR) 62.65p 2.37%
Countryside Properties (CSP) 333.40p 2.24%
Brewin Dolphin Holdings (BRW) 338.30p 1.99%
William Hill (WMH) 291.20p 1.78%
Great Portland Estates (GPOR) 640.00p 1.67%
Ferrexpo (FXPO) 175.10p 1.39%

FTSE 250 - Fallers

TalkTalk Telecom Group (TALK) 175.50p -3.62%
Ascential (ASCL) 342.50p -3.03%
Petra Diamonds Ltd.(DI) (PDL) 129.10p -2.71%
Polymetal International (POLY) 999.50p -2.49%
Hochschild Mining (HOC) 282.10p -2.46%
Euromoney Institutional Investor (ERM) 1,181.00p -2.15%
Cairn Energy (CNE) 206.30p -2.04%
FirstGroup (FGP) 150.00p -1.96%
Capita (CPI) 559.00p -1.84%
IP Group (IPO) 142.00p -1.80%