London midday: Stocks slide amid Brexit fears, falling oil prices

London stocks were dragged lower on Wednesday by Brexit fears and a drop in oil prices.

Worries about the consequences of Britain possibly leaving the European Union in a 23 June referendum grew even as the latest opinion poll showed most UK residents were in favour of an “in” vote. The ComRes poll for the Daily Mail revealed 51% were leaning towards the campaign to remain in the EU while 39% wanted a so-called Brexit and 10% were undecided.

Britain’s businesses have expressed concerns that a vote to leave the European Union will deter investment in the UK.

“It will be a momentous decision and a vote for Brexit would have potentially huge consequences for all asset classes,” HSBC said in a note.

“Following a vote to leave, we think uncertainty could grip the UK economy, triggering a potential slowdown in growth and a collapse in sterling.”

The pound fell 0.92% against the US dollar and 0.40% versus the euro at 1148 GMT.

Connor Campbell, financial analyst at Spreadex, said: “It appears that the Brexit fears that were naively ignored at the start of the week have truly taken hold this Wednesday, with the fact that any oil output freeze hopes seem to have been banished merely rotten icing on the cake.”

Oil prices fell on doubts that global producers will reach a deal proposed by Russia and Saudi Arabia to freeze crude production at January levels.

Brent crude slipped 1.8% to $32.67 per barrel and West Texas Intermediate dropped 3.0% to $30.94 per barrel at 1137 GMT.

In economic data, the number of mortgage approvals in January gained 33% with remortgaging up 42% and house purchases up 27%. Loans for house purchases rose to 47,509 in January from 43,660 in December, surging past analysts’ expectations of 44,800. The BBA said that reports suggest the increase in borrowing is due to buy-to-let and second-home buyers rushing to complete purchases ahead of the 3% increase in stamp duty in April.

Still to come, Markit’s US services purchasing mangers’ index is due at 1445 GMT and a report on US new home sales will be released at 1500 GMT.

Among corporate stocks, shares in Barratt Development jumped after it hiked its dividend by a quarter and said profits mushroomed in the first half of the year.

Persimmon also continued to rally after reporting healthy full year results as UBS upgraded the stock to ‘buy’ from ‘neutral’ and raised the price target to 2,330p from 2,135p .

International Personal Finance Group was in the red after revealing a drop in annual profit and revenue.

Man Group edged lower after reporting a 20.25% fall in adjusted pre-tax profit for the full year.

Hays slumped after the recruitment agency said it was mindful of increasing global uncertainties as it posted its half year results.

Meanwhile, Standard Chartered continued to tumble a day after reporting disappointing full year results as Bank of America Merrill Lynch downgraded stock to ‘neutral’ from ‘buy’ and slashed the price target to 475p from 650p.

BHP Billiton and GKN were also under the cosh after posting weak corporate earnings on Tuesday.

Market Movers

FTSE 100 (UKX) 5,886.37 -1.27%
FTSE 250 (MCX) 16,137.86 -0.56%
techMARK (TASX) 3,090.92 -0.86%

FTSE 100 - Risers

Persimmon (PSN) 2,067.00p 1.87%
Randgold Resources Ltd. (RRS) 6,635.00p 1.76%
Barratt Developments (BDEV) 569.00p 1.25%
Berkeley Group Holdings (The) (BKG) 3,261.00p 1.21%
Intertek Group (ITRK) 2,863.00p 1.13%
ITV (ITV) 251.60p 1.00%
Relx plc (REL) 1,227.00p 0.90%
Compass Group (CPG) 1,240.00p 0.90%
3i Group (III) 424.00p 0.43%
Associated British Foods (ABF) 3,310.00p 0.36%

FTSE 100 - Fallers

Glencore (GLEN) 119.80p -7.45%
BHP Billiton (BLT) 693.90p -7.10%
Anglo American (AAL) 422.15p -6.83%
Antofagasta (ANTO) 472.60p -4.83%
GKN (GKN) 257.40p -4.70%
Burberry Group (BRBY) 1,180.00p -4.38%
Standard Chartered (STAN) 389.70p -4.24%
Sports Direct International (SPD) 386.00p -3.91%
Rio Tinto (RIO) 1,917.00p -3.57%
Standard Life (SL.) 318.00p -2.93%

FTSE 250 - Risers

Entertainment One Limited (ETO) 145.90p 7.28%
Petrofac Ltd. (PFC) 791.00p 6.60%
Acacia Mining (ACA) 249.20p 4.97%
Centamin (DI) (CEY) 90.95p 3.65%
TalkTalk Telecom Group (TALK) 221.70p 3.12%
Northgate (NTG) 364.80p 2.76%
Riverstone Energy Limited (RSE) 810.50p 2.59%
Hiscox Limited (DI) (HSX) 1,050.00p 2.24%
CLS Holdings (CLI) 1,449.36p 2.00%
Savills (SVS) 690.00p 1.85%

FTSE 250 - Fallers

International Personal Finance (IPF) 226.20p -14.71%
Man Group (EMG) 149.40p -7.49%
Hays (HAS) 115.50p -7.00%
Auto Trader Group (AUTO) 363.10p -6.20%
Vedanta Resources (VED) 242.90p -5.85%
Amec Foster Wheeler (AMFW) 339.50p -5.64%
Drax Group (DRX) 225.50p -5.33%
Meggitt (MGGT) 407.30p -4.99%
Morgan Advanced Materials (MGAM) 212.50p -4.71%
Rotork (ROR) 156.60p -4.34%