London open: Stocks fall as BoJ governor warns on Brexit
London stocks fell on Monday after Bank of Japan governor said the possibility of the UK leaving the European Union poses a serious risk to the global economy.
Haruhiko Kuroda told the BBC a vote by Britain to exit the EU in the 23 June referendum would have a “significant and serious impact” on the world economy.
Kuroda also defended his negative interest rate policy and said he was willing to loosen monetary policy further if needed to boost the real economy and inflation.
His remarks came as data showed the manufacturing industry fell further into a contraction. The Nikkei flash purchasing managers’ index dropped to 47.6 in May from 48.2 in April, below the 50 level that separates a contraction from an expansion.
Meanwhile the yen strengthened against most currencies after official data showed a surprise trade surplus in April. Japan’s trade surplus came in at 825.5bn yen, well above the market forecast of 535bn yen.
In the eurozone, Markit’s manufacturing PMI dipped to 51.5 in May from 51.7 in April, missing forecasts for a reading of 51.9.
The services PMI for the bloc held at 53.1 in May, slightly below estimates of 53.2.
Still to come, Federal Reserve official James Bullard speaks in Beijing at 1115 BST while fellow Fed policymaker John Williams speaks in New York at 1300 BST. US manufacturing PMI is due at 1445 BST and the eurozone consumer confidence index will be released at 1500 BST.
Meanwhile, oil prices fell on a strong dollar and signs that the global supply glut persists. Brent crude fell 1.05% to $48.21 per barrel and West Texas Intermediate declined 1.2% to $47.79 per barrel at 0859 BST.
On the company front, mining stocks slumped including Anglo American, Glencore and BHP Billiton as metal prices fell.
Ryanair shares were broadly flat after reporting a jump in full-year profit but cautioning that profit growth for this year is likely to be modest.
Mitie Group advanced after saying total annual operating profit grew 100.9% to £112.5m, with basic earnings per share growth of 119.6%.
Market Movers
FTSE 100 (UKX) 6,130.47 -0.42%
FTSE 250 (MCX) 16,966.08 0.26%
techMARK (TASX) 3,069.64 0.02%
FTSE 100 - Risers
Royal Mail (RMG) 508.50p 3.37%
ARM Holdings (ARM) 967.00p 2.38%
Randgold Resources Ltd. (RRS) 6,115.00p 1.41%
Sage Group (SGE) 596.00p 0.93%
DCC (DCC) 6,535.00p 0.77%
Carnival (CCL) 3,560.00p 0.74%
Land Securities Group (LAND) 1,182.00p 0.60%
easyJet (EZJ) 1,478.00p 0.54%
Intu Properties (INTU) 287.80p 0.49%
Mediclinic International (MDC) 850.50p 0.47%
FTSE 100 - Fallers
Anglo American (AAL) 577.40p -3.81%
Inmarsat (ISAT) 732.00p -3.05%
BHP Billiton (BLT) 796.60p -2.60%
Glencore (GLEN) 126.05p -2.02%
Rio Tinto (RIO) 1,919.00p -1.72%
Standard Chartered (STAN) 517.60p -1.63%
Marks & Spencer Group (MKS) 438.60p -1.37%
Rolls-Royce Holdings (RR.) 635.00p -1.24%
Royal Dutch Shell 'A' (RDSA) 1,662.00p -1.07%
Royal Dutch Shell 'B' (RDSB) 1,671.00p -1.07%
FTSE 250 - Risers
Pendragon (PDG) 39.37p 3.52%
CLS Holdings (CLI) 1,590.00p 3.25%
IP Group (IPO) 155.50p 2.37%
OneSavings Bank (OSB) 316.30p 2.16%
JRP Group (JRP) 143.00p 2.14%
Moneysupermarket.com Group (MONY) 320.90p 2.13%
Weir Group (WEIR) 1,253.00p 1.95%
John Laing Group (JLG) 220.30p 1.85%
Homeserve (HSV) 425.80p 1.84%
Telecom Plus (TEP) 995.50p 1.84%
FTSE 250 - Fallers
ICAP (IAP) 410.70p -4.86%
Sports Direct International (SPD) 351.20p -4.82%
Restaurant Group (RTN) 344.10p -2.27%
Cobham (COB) 158.10p -1.98%
Vedanta Resources (VED) 372.40p -1.87%
Allied Minds (ALM) 330.50p -1.72%
Wizz Air Holdings (WIZZ) 1,913.00p -1.65%
Amec Foster Wheeler (AMFW) 443.20p -1.53%
Mitchells & Butlers (MAB) 273.30p -1.48%
Tullow Oil (TLW) 243.50p -1.42%