London open: Profit-taking deepens as losses on Wall Street mount, retail sales crater

London stocks were getting walloped at the open as investors' jitters around the prospects for policy tightening by the US central bank continued and after the Office of National Statistics reported that UK retail sales cratered at the end of 2021.

As of 0927 GMT, the FTSE 100 was trading 0.91% or 69.35 points lower at 7,515.17, alongside a 1.45% drop on the FTSE 250 to 22,385.75.

Overnight, the Dow Industrials, S&P 500 and Nasdaq Composite all gave back about 1%, alongside a five basis point drop in 10-year Treasury yields and a 7.3% jump in the CBoE's volatility index.

"Tech carnage continues, stock markets continue downwards spiral, pandemic bubble stocks getting some treatment, Bitcoin cracks at $40k," was Market.com chief market analyst Neil Wilson's take on the latest market ructions Stateside.

"Is this the bear market proper – an end to the ’09-’18 expansion? Jeremy Grantham reckons trend for the S&P 500 is 2,500 – we’re at 4,400 still. Who’s up for a 50% decline? The Fed would try to stop that but can it?"

Worth noting, Thursday's losses in the US materialised despite Janet Yellen, the US Treasury chief, sounding a positive note on the inflation outlook for the year ahead, indicating that it might fall sharply should the pandemic be brought under control.

Adding to the downbeat sentiment, shares of US video-streaming giant Netflix were tumbling 21% in premarket trading after the company's fourth quarter subscriber growth numbers disappointed analysts.

US pre-market equity futures were pointing to a relatively flat start to trading on the Dow Industrial and S&P 500 at the end of the week, although Nasdaq-100 futures were again under some pressure .

On home shores, the latest economic news was very downbeat.

According to the Office for National Statistics, UK retail sales dropped 3.7% month-on-month, which was far worse than the 0.6% drop expected by economists. In annual terms, they were down by 0.9% instead of 3.2% higher as anticipated by the consensus.

Mirroring that drop in retail sales, consultancy GfK reported a big drop in consumer sentiment as concerns about the rising cost of living mounted.

GfK's Consumer Confidence Index fell four points in January, to -19, its lowest level since February 2021. GfK attributed the fall to expected rises in inflation, fuel and interest rates.

Joe Staton, Client Strategy Director at GfK, said: " Despite some good news about the easing of Covid restrictions, consumers are clearly bracing themselves for surging inflation, rising fuel bills and the prospect of interest rate rises."

Close Brothers Group performs well in 1H, Ninety One posts small gain in AuM

Close Brothers Group reported that the firm had "performed well" over the first half of its financial year with "good" loan book growth and "strong" margins in Banking. Growth momentum at Close Brothers Asset Management had continued, although trading income in Winterflood has moderated since the end of the 2021 financial year.

Investment company Ninety One on Friday said assets under management at December 31 had risen to £141.7bn compared with £128.6bn a year earlier. The figure was a slight rise on the £140bn recorded at the end of last September, Ninety One said in an extremely short trading update.

Promotional products business 4imprint Group said on Friday that full-year unaudited group revenues had shot up in 2021, pushing pre-tax profits towards the upper end of analysts' forecasts. 4imprint stated revenues for the 2021 financial year was approximately $787.0m, an increase of 41% year-on-year, as its total order count was roughly 90% of the figure seen in 2019, demonstrating "a strong recovery" in the business over the course of the year.

Market Movers

FTSE 100 (UKX) 7,506.77 -1.03%
FTSE 250 (MCX) 22,389.12 -1.43%
techMARK (TASX) 4,469.11 -1.14%

FTSE 100 - Risers

Avast (AVST) 605.40p 0.77%
British American Tobacco (BATS) 3,132.00p 0.59%
Imperial Brands (IMB) 1,734.00p 0.55%
Intertek Group (ITRK) 5,448.00p 0.44%
Relx plc (REL) 2,290.00p 0.35%
Rentokil Initial (RTO) 528.60p 0.27%
United Utilities Group (UU.) 1,075.00p 0.23%
Burberry Group (BRBY) 1,914.50p 0.21%
InterContinental Hotels Group (IHG) 4,947.00p 0.16%
Severn Trent (SVT) 2,922.00p 0.14%

FTSE 100 - Fallers

Scottish Mortgage Inv Trust (SMT) 1,114.00p -3.47%
Fresnillo (FRES) 832.80p -3.34%
BHP Group (BHP) 2,422.00p -3.22%
Rio Tinto (RIO) 5,410.00p -3.05%
Flutter Entertainment (CDI) (FLTR) 11,010.00p -2.95%
Evraz (EVR) 548.60p -2.76%
International Consolidated Airlines Group SA (CDI) (IAG) 158.24p -2.66%
Taylor Wimpey (TW.) 156.95p -2.45%
Pershing Square Holdings Ltd NPV (PSH) 2,805.00p -2.43%
Entain (ENT) 1,682.50p -2.41%

FTSE 250 - Risers

Premier Foods (PFD) 120.60p 1.69%
4Imprint Group (FOUR) 2,665.00p 1.33%
Ninety One (N91) 267.80p 0.90%
Fidelity Emerging Markets Limited Ptg NPV (FEML) 811.00p 0.37%
BH Macro Ltd. GBP Shares (BHMG) 3,750.00p 0.27%
Contour Global (GLO) 187.20p 0.21%
PZ Cussons (PZC) 197.80p 0.20%
PureTech Health (PRTC) 280.50p 0.18%
Plus500 Ltd (DI) (PLUS) 1,487.00p 0.17%
Sirius Real Estate Ltd. (SRE) 129.80p 0.15%

FTSE 250 - Fallers

Playtech (PTEC) 625.00p -14.44%
Hochschild Mining (HOC) 121.40p -4.63%
Baltic Classifieds Group (BCG) 208.00p -4.59%
Darktrace (DARK) 417.20p -4.40%
Harbour Energy (HBR) 344.80p -4.06%
Spirent Communications (SPT) 241.60p -3.82%
Ferrexpo (FXPO) 246.60p -3.67%
Trustpilot Group (TRST) 224.40p -3.61%
Cineworld Group (CINE) 42.85p -3.60%
Allianz Technology Trust (ATT) 282.50p -3.58%