London open: Stocks little changed ahead of manufacturing data

London stocks were little changed at the open on Monday even as Chinese equities tumbled, with all eyes on the release of the latest UK manufacturing data.

At 0850 GMT, the FTSE 100 was up 0.1% at 7,293.80, having fallen on Friday to a seven-week low.

Shares in China sank on the first day back since the Lunar New Year break, with Shanghai’s composite index down nearly 8% as markets caught up with the losses that occurred while they were shut.

London Capital Group analyst Jasper Lawler said "it might have been worse if the China’s central bank hadn’t pumped in billions and cut funding costs".

Earlier on Monday, the People’s Bank of China cut the seven- and 14-day reverse repo rates by 10 basis points and injected 1.2 trillion yuan of liquidity into the financial system through reverse repos.

Neil Wilson, chief market analyst at Markets.com, said: "As yet the spread of the virus has not reached epidemic levels in Europe or the US, but we are entering a key period now and a sharp escalation in cases closer to home would spook the markets. Bulls are defending the 7,300 level on the FTSE 100 but the longer-term downtrend remains the dominant force - big test around 7,350 for bulls to clear today, failure there brings 7,130 into view.

"The situation in China looks pretty dire and globally we now have more 17k cases confirmed and 362 deaths. Apple will close all stores and offices in China. This has the hallmarks of a black swan event in the making - we simply don’t know yet what the impact will be. China is a far larger portion of global GDP than it was in 2003 (about 18%). Cool heads play it down, and we should remain level-headed here, but this is how crises can start."

On home shores, Prime Minister Boris Johnson was due to say in a speech in London that there is "no need" for the UK to sign up to EU rules and regulations in exchange for his levels of access to European markets.

"In other words, exactly the kind of tactic that is going to give sterling palpitations over the coming months," said Spreadex analyst Connor Campbell.

On the data front, Markit's UK manufacturing PMI is out at 0930 GMT.

In equity markets, easyJet was a high riser, taking its cue from Ryanair, which rose sharply after saying it swung to a profit in the third quarter.

Elsewhere, Imperial Brands ticked higher as it appointed Inchcape chief executive Stefan Bomhard to its top job, replacing Alison Cooper who stepped down with immediate effect.

Future rallied after it said the outcome for the full year was set to be "materially ahead" of current market expectations, despite some uncertainty in the macro-economic environment. On Friday, shares in the magazine publisher slumped after London-based research firm and short-seller Shadowfall Research said it was short the stock, arguing that it was overvalued.

On the downside, miners were under the cosh, with Glencore, BHP, Anglo American and Rio Tinto all lower.

Market Movers

FTSE 100 (UKX) 7,293.80 0.11%
FTSE 250 (MCX) 21,159.57 0.08%
techMARK (TASX) 4,135.30 0.18%

FTSE 100 - Risers

Auto Trader Group (AUTO) 572.00p 1.78%
Hargreaves Lansdown (HL.) 1,752.50p 1.59%
easyJet (EZJ) 1,413.00p 1.44%
SSE (SSE) 1,529.00p 1.36%
BT Group (BT.A) 163.06p 1.33%
Johnson Matthey (JMAT) 2,639.00p 1.31%
Barratt Developments (BDEV) 812.40p 1.20%
Centrica (CNA) 85.78p 1.11%
Polymetal International (POLY) 1,300.00p 1.09%
Rightmove (RMV) 664.20p 0.97%

FTSE 100 - Fallers

Glencore (GLEN) 220.15p -1.06%
Anglo American (AAL) 1,967.40p -0.92%
Royal Dutch Shell 'A' (RDSA) 1,976.80p -0.88%
BHP Group (BHP) 1,646.60p -0.80%
Royal Bank of Scotland Group (RBS) 216.60p -0.78%
Spirax-Sarco Engineering (SPX) 8,855.00p -0.73%
Evraz (EVR) 350.30p -0.65%
Royal Dutch Shell 'B' (RDSB) 1,987.00p -0.65%
Ocado Group (OCDO) 1,216.00p -0.61%
United Utilities Group (UU.) 1,008.00p -0.54%

FTSE 250 - Risers

Future (FUTR) 1,362.00p 6.41%
Drax Group (DRX) 279.00p 2.57%
Avast (AVST) 435.60p 2.49%
Network International Holdings (NETW) 621.00p 2.14%
Virgin Money UK (VMUK) 167.75p 2.13%
Bakkavor Group (BAKK) 138.40p 1.91%
Britvic (BVIC) 943.00p 1.89%
TalkTalk Telecom Group (TALK) 120.60p 1.77%
Pershing Square Holdings Ltd NPV (PSH) 1,482.00p 1.09%
Smithson Investment Trust (SSON) 1,308.00p 1.08%

FTSE 250 - Fallers

Aston Martin Lagonda Global Holdings (AML) 472.30p -5.31%
Contour Global (GLO) 186.80p -2.71%
Tullow Oil (TLW) 49.47p -2.69%
Finablr (FIN) 80.60p -2.42%
Premier Oil (PMO) 98.36p -1.98%
McCarthy & Stone (MCS) 144.60p -1.90%
Cairn Energy (CNE) 166.50p -1.77%
Fresnillo (FRES) 652.60p -1.48%
Micro Focus International (MCRO) 1,010.20p -1.46%
Savills (SVS) 1,226.00p -1.45%