London open: Stocks decline on weak Chinese data, falling oil prices

The FTSE 100 opened lower on Monday after disappointing Chinese manufacturing data and a continued slump in oil prices.

The official purchasing managers’ index for manufacturing fell to 49.7 in January from 49.7 the previous month, missing analysts’ expectations for a reading of 49.6 and below the 50 level that separates a contraction from an expansion in sector activity.

The private PMI from Caixin on manufacturing also registered a contraction in January at 48.4. However it was better than December’s 48.2 and analysts’ estimates of 48.1.

“For an extended period economic data from Beijing has repeatedly followed a negative trajectory and this has compounded the growing concerns that capital outflows may accelerate as the economy continues to slow,” said FXTM research analyst Lukman Otununga.

“Sentiment towards the Chinese economy is heavily bearish and despite the People’s Bank of China (PBoC) pledging to maintain a prudent monetary policy in 2016, this visible deceleration may force the Central bank to unleash aggressive monetary policy in a bid to revive growth.”

Markit's Eurozone manufacturing PMI was confirmed at 52.3 in January, as expected, up from December's 53.2.

UK manufacturing PMI from Markit will be released at 0930 GMT, with analysts expecting a reading of 51.6 in January, down from 51.9 in December.

Markit also releases US manufacturing PMI for January at 1445 GMT, while ISM publishes its manufacturing index for January at 1500 GMT.

Other data due throughout the day includes UK net consumer credit figures at 0930 GMT, the US personal consumption expenditure report at 1330 GMT and US construction spending at 1500 GMT.

Meanwhile, oil prices declined on dimming prospects of a deal on a production cut by global oil producers to address the supply glut. Brent crude fell 1.8% to $35.34 per barrel and West Texas Intermediate dropped 2.0% to $32.94 per barrel 0902 GMT.

In company news, Ryanair flew higher after posting a jump in third quarter profit as traffic grew strongly and the budget airline announced a €800m share buyback programme.

Premier Oil surged after it resumed trading on Monday as the terms of its deal to buy the UK North Sea assets of German power company E.ON were amended so that it no longer constitutes a reverse takeover.

BT gained after reporting a 3% increase in third quarter revenue to £4.59bn.

Market Movers

FTSE 100 (UKX) 6,071.98 -0.19%
FTSE 250 (MCX) 16,496.65 0.05%
techMARK (TASX) 3,166.22 0.00%

FTSE 100 - Risers

BT Group (BT.A) 496.15p 2.33%
Anglo American (AAL) 282.15p 1.69%
InterContinental Hotels Group (IHG) 2,330.00p 1.44%
United Utilities Group (UU.) 970.00p 1.41%
Sky (SKY) 1,097.00p 1.39%
Severn Trent (SVT) 2,219.00p 1.37%
easyJet (EZJ) 1,568.00p 1.29%
ARM Holdings (ARM) 1,005.00p 1.21%
Coca-Cola HBC AG (CDI) (CCH) 1,446.00p 1.19%
Barclays (BARC) 188.05p 1.10%

FTSE 100 - Fallers

BP (BP.) 370.30p -1.54%
AstraZeneca (AZN) 4,426.50p -1.36%
Prudential (PRU) 1,350.00p -1.28%
Imperial Tobacco Group (IMT) 3,746.00p -1.06%
British American Tobacco (BATS) 3,861.50p -0.91%
St James's Place (STJ) 945.50p -0.79%
Legal & General Group (LGEN) 241.70p -0.74%
HSBC Holdings (HSBA) 488.85p -0.70%
Unilever (ULVR) 3,063.50p -0.70%
Worldpay Group (WI) (WPG) 310.90p -0.67%

FTSE 250 - Risers

Allied Minds (ALM) 299.00p 5.88%
Nostrum Oil & Gas (NOG) 288.00p 4.73%
AO World (AO.) 156.90p 3.22%
Home Retail Group (HOME) 141.00p 3.15%
Jimmy Choo (CHOO) 143.20p 3.02%
Worldwide Healthcare Trust (WWH) 1,725.00p 2.62%
Evraz (EVR) 63.85p 2.41%
UDG Healthcare Public Limited Company (UDG) 536.50p 2.39%
Clarkson (CKN) 2,104.00p 2.38%
Vesuvius (VSVS) 307.40p 1.89%

FTSE 250 - Fallers

Vedanta Resources (VED) 235.90p -3.36%
Laird (LRD) 348.00p -1.97%
Just Eat (JE.) 366.20p -1.93%
Go-Ahead Group (GOG) 2,403.00p -1.88%
Greencore Group (GNC) 382.90p -1.52%
Wood Group (John) (WG.) 633.50p -1.48%
Jupiter Fund Management (JUP) 409.40p -1.44%
Kennedy Wilson Europe Real Estate (KWE) 1,098.00p -1.44%
Phoenix Group Holdings (DI) (PHNX) 852.50p -1.39%
Tullow Oil (TLW) 169.30p -1.34%