London open: Stocks fall after disappointing Chinese data

London stocks fell in early trade on Monday, with miners under the cosh following the release of disappointing Chinese data.

At 0850 BST, the FTSE 100 was down 0.6% at 7,179.19.

Figures released earlier by the National Bureau of Statistics showed that growth in China’s industrial production and retail sales slowed sharply in July amid flooding and a rise in Covid cases.

Industrial production rose 6.4% on the year following an 8.3% increase in June, coming in below consensus expectations of 7.% growth. Retail sales grew 8.5%, down from 12.1% growth in June and undershooting expectations for a 10.9% jump.

Meanwhile, fixed asset investment was up 10.3% on the year in July, down from 12.6% the month before and missing consensus expectations of 11.3%.

The NBS highlighted "the impact of multiple factors including the growing external uncertainties and the domestic Covid-19 epidemic and flooding situation". It also said the country’s economic recovery is "still unstable and uneven".

Neil Wilson, chief market analyst at Markets.com, said: "We can look to Covid-related slowdowns, particularly the spread of delta in Asia, softer-than-expected Chinese data, and the fallout from a very poor University of Michigan consumer sentiment report on Friday.

"I’d even speculate that the tragedy in Afghanistan is a factor in the downbeat mood. This foreign policy disaster will have repercussions - President Biden will never recover from it. The scenes of chaos as the US evacuates Kabul is too reminiscent of Saigon.

"Nevertheless, after a decent run-up - record highs on Wall St, a new all-time high for the DAX and a post-pandemic peak for the FTSE 100, some giveback can always be expected."

On home shores, the latest survey from Rightmove showed that average asking prices for homes in the UK fell in August for the first time this year as prices for "upper end" homes declined 0.8%. Asking prices were down 0.3% on the month following a 0.7% jump in July.

Tim Bannister, Rightmove’s director of Property Data, said: "New sellers dropping their asking prices can ring economy alarm bells, especially when it’s the first time so far this year, so it’s important to dig underneath the headline figures.

"Firstly, we are in the holiday season which means that sellers have traditionally tempted distracted buyers with lower prices, though that might well be less applicable this year with many buyers having to stay a lot closer to home.

"Indeed, our analysis shows that average prices have only fallen in the upper-end sector, which is usually more affected by seasonal factors such as the summer holidays and has also seen the greatest withdrawal of stamp duty incentives.

"The mass-market of properties that cater for first-time buyers and second-steppers is still seeing high demand and upwards price pressure leading to new record high average prices in those sectors. In England there remains a smaller stamp duty saving of up to £2,500, though the window to take advantage of this saving by buying now and completing by the end of September is pretty much closed."

In equity markets, the weak Chinese data weighed on mining stocks, with Glencore, Anglo American and Rio all trading lower.

BHP was in the red after confirming it is in talks about a potential merger of its petroleum business with Australia’s Woodside Petroleum.

On the upside, Ultra Electronics rallied after agreeing a £2.57bn deal to be bought by defence group Cobham. The latter is offering £35 a share and "legally binding and enforceable commitments" to the UK government on national security matters.

Future surged to the top of the FTSE 250 after saying it had bought consumer media company Dennis for around £300m in cash from Exponent Private Equity.

Meggitt was little changed after the aerospace and defence group formally recommended a £6.3bn takeover by US peer Parker Hannifin.

Market Movers

FTSE 100 (UKX) 7,179.19 -0.55%
FTSE 250 (MCX) 23,765.88 -0.09%
techMARK (TASX) 4,783.88 0.02%

FTSE 100 - Risers

Hikma Pharmaceuticals (HIK) 2,549.00p 0.75%
British Land Company (BLND) 535.80p 0.64%
Land Securities Group (LAND) 736.20p 0.60%
Sage Group (SGE) 725.40p 0.47%
Admiral Group (ADM) 3,623.00p 0.42%
Informa (INF) 554.20p 0.40%
Sainsbury (J) (SBRY) 303.50p 0.40%
Ocado Group (OCDO) 1,787.00p 0.39%
Coca-Cola HBC AG (CDI) (CCH) 2,676.00p 0.38%
SEGRO (SGRO) 1,266.50p 0.36%

FTSE 100 - Fallers

JD Sports Fashion (JD.) 957.40p -1.99%
Burberry Group (BRBY) 2,093.00p -1.74%
Glencore (GLEN) 331.00p -1.74%
Pershing Square Holdings Ltd NPV (PSH) 2,565.00p -1.72%
BP (BP.) 300.15p -1.70%
Royal Dutch Shell 'A' (RDSA) 1,438.40p -1.45%
Anglo American (AAL) 3,340.00p -1.45%
Royal Dutch Shell 'B' (RDSB) 1,418.00p -1.45%
Rio Tinto (RIO) 5,570.00p -1.42%
M&G (MNG) 223.00p -1.41%

FTSE 250 - Risers

Future (FUTR) 3,884.00p 5.37%
Ultra Electronics Holdings (ULE) 3,312.00p 4.74%
Tritax Big Box Reit (BBOX) 235.20p 1.64%
Safestore Holdings (SAFE) 1,138.00p 1.61%
Capital & Counties Properties (CAPC) 180.40p 1.46%
Apax Global Alpha Limited (APAX) 215.50p 1.41%
LondonMetric Property (LMP) 262.60p 1.39%
Shaftesbury (SHB) 639.00p 1.27%
Indivior (INDV) 174.10p 1.16%
Sirius Real Estate Ltd. (SRE) 124.40p 1.14%

FTSE 250 - Fallers

Carnival (CCL) 1,488.60p -3.06%
Harbour Energy (HBR) 349.00p -2.40%
easyJet (EZJ) 797.80p -2.40%
Trainline (TRN) 359.20p -2.23%
Auction Technology Group (ATG) 1,376.00p -2.13%
Baillie Gifford Japan Trust (BGFD) 996.00p -1.97%
Ferrexpo (FXPO) 397.80p -1.73%
Energean (ENOG) 642.00p -1.61%
Hochschild Mining (HOC) 148.10p -1.53%
Wizz Air Holdings (WIZZ) 5,032.00p -1.49%