London open: Markets flat as Greece submits reform list, investors await Yellen

UK stocks opened slightly lower on Tuesday morning as investors waited nervously to see if Eurozone finance ministers will sign off on a Greek bailout extension.

The FTSE 100 was trading down 0.07% at 6,907.52 in early deals. BHP Billiton impressed with its annual results, while Meggitt, Persimmon and GKN underwhelmed.

Greece submitted a list of economic reforms overnight for European leaders to approve as part of the provisional agreement with Athens for the four-month bailout extension agreed on Friday.

The Eurogroup is expected to discuss the proposals, which include efforts to crack down on tax evasion and corruption, later on Tuesday.

An official at the European Commission said the list was “sufficiently comprehensive to be a valid starting point for a successful conclusion of the review”.

Stocks in Athens were up by over 6% early on Tuesday, while the yield on three-year Greek bonds had dropped 150 basis points.

Federal Reserve chair Janet Yellen will also be in focus on Tuesday as she gives her semi-annual testimony to the Senate Banking Committee. Analysts are expecting a hawkish stance from the Fed chair as markets await hints about when the central bank will begin to raise interest rates.

“For the market, the risk is that Yellen may sound more upbeat on the economy in light of the strong January employment report, and possibly make the case to Congress that the time is approaching for the Fed to begin the process of policy normalisation,” according to analysts at Deutsche Bank.

BHP Billiton jumps after profit beat

Mining giant BHP Billiton jumped early on after beating forecasts with a less-than-expected decline in earnings in the first half. Underlying operating profits fell 12.3% year-on-year to $14.49bn, compared with analysts’ forecasts of around $13.62bn. The group also pledged to keep its dividend policy unchanged despite the proposed demerger of its non-core operations.

Engineering group Meggitt declined as it reported a 13% fall in underlying pre-tax profit in 2014 following a “challenging year”.

Sector peer GKN also underwhelmed despite beating forecasts with a 4% increase in ‘management basis’ pre-tax profit in 2014. Numis downgraded the stock from ‘add’ to ‘hold’ after a strong run in the shares over recent months.

Persimmon also failed to impress despite meeting expectations with a 44% increase in underlying pre-tax profits in 2014. The stock reversed early on after having jumped 18% since mid-January.

Paper and packaging group Mondi rose after revealing that profit before tax rose 24% to €619m in 2014 while its full-year dividend was lifted 17%.

Pension provider Just Retirement surged after saying it delivered “resilient profits” despite changes made to the annuity market in the government Budget last year. Annuity sales were down just 4% on the pre-Budget comparison period, it said.

Market Movers
techMARK 3,145.96 -0.38%
FTSE 100 6,907.52 -0.07%
FTSE 250 17,124.14 -0.26%

FTSE 100 - Risers
BHP Billiton (BLT) 1,600.50p +3.46%
Mondi (MNDI) 1,298.00p +1.64%
Hargreaves Lansdown (HL.) 1,091.00p +1.02%
Carnival (CCL) 2,927.00p +1.00%
G4S (GFS) 296.10p +0.99%
Sage Group (SGE) 483.80p +0.98%
British American Tobacco (BATS) 3,760.00p +0.87%
BAE Systems (BA.) 538.50p +0.84%
International Consolidated Airlines Group SA (CDI) (IAG) 565.50p +0.62%
British Land Co (BLND) 825.50p +0.61%

FTSE 100 - Fallers
Persimmon (PSN) 1,648.00p -3.63%
GKN (GKN) 373.60p -3.21%
Meggitt (MGGT) 553.50p -3.06%
Vodafone Group (VOD) 227.05p -2.43%
Taylor Wimpey (TW.) 142.50p -1.93%
Rolls-Royce Holdings (RR.) 933.00p -1.79%
Standard Chartered (STAN) 914.20p -1.50%
Associated British Foods (ABF) 3,016.00p -1.37%
Smiths Group (SMIN) 1,162.00p -1.19%
Barratt Developments (BDEV) 497.50p -1.09%

FTSE 250 - Risers
Just Retirement Group (JRG) 170.30p +18.59%
Genus (GNS) 1,356.00p +5.20%
NMC Health (NMC) 525.00p +3.35%
Afren (AFR) 9.71p +2.37%
AL Noor Hospitals Group (ANH) 967.00p +2.00%
Melrose Industries (MRO) 306.10p +1.97%
Acacia Mining (ACA) 272.70p +1.75%
Ashmore Group (ASHM) 313.30p +1.39%
Polymetal International (POLY) 569.50p +1.24%
Inchcape (INCH) 745.50p +1.15%

FTSE 250 - Fallers
Victrex plc (VCT) 2,019.00p -4.63%
Bovis Homes Group (BVS) 916.00p -3.68%
Inmarsat (ISAT) 855.00p -3.66%
Bank of Georgia Holdings (BGEO) 1,890.00p -3.57%
Infinis Energy (INFI) 192.90p -3.07%
AO World (AO.) 282.50p -2.82%
Saga (SAGA) 184.00p -2.13%
Computacenter (CCC) 718.00p -1.98%
Diploma (DPLM) 785.50p -1.94%
Bellway (BWY) 1,950.00p -1.91%