London open: Stocks on front foot ahead of unemployment data
The FTSE 100 opened higher on Wednesday with financials stocks leading the way as expectations of monetary stimulus continues to grow.
The blue chip index was up 0.31% to 6,718.34 by 0835 BST, while the FTSE 250 was up 0.18% at 16,935.97 with news-driven risers to the fore.
CMC Markets’ Jasper Lawler said: “One of the catalysts for the rally in share prices since the Brexit vote has been the expectation of monetary stimulus. Those expectations were significantly dampened after the Bank of England caught markets by surprise by failing to cut rates last week. Since that decision, the FTSE 100 has been directionless.
“Nonetheless, further easing is still expected, but not just from the Bank of England and the Bank of Japan. The Reserve Banks of Australia and New Zealand signalled more stimulus could be in the pipeline in minutes released on Tuesday. And on Thursday Mario Draghi is likely to indicate the ECB is willing to “do what it takes” if Brexit interrupts the fragile European economic recovery.”
On the data front, the UK unemployment rate, claimant count and average earnings are all at 0930 BST. In the US, MBA mortgage applications are at 1200 BST.
In corporate news, BHP Billiton was among the group of commodities stocks falling in early trade. BHP posted its operational review for the year to end-June, confirming it exceeded full-year production guidance for petroleum, copper and metallurgical coal, and achieved record full-year production at Western Australia Iron Ore.
The miner said it expects to achieve full-year cost guidance at its major assets, with unit costs forecast to decline further next year. Underlying attributable profit in the June 2016 half-year is expected to include additional charges of up to $175m, the company warned.
Fresnillo was another faller, caught up in a minor sector-wide selloff despite strong first-quarter production leading to full year gold guidance being raised to 850-870 koz from 775-790 koz, while full year silver production remains on track to meet 49-51 moz targets.
Elsewhere, speciality chemicals Johnson Matthey was climbing slowly as it reported that first quarter sales rose 6% thanks to strong sales growth in Emission Control Technologies and further progress in new businesses, and news that profits could be boosted substantially by weakness of the pound. Underlying profit before tax for the full year was said to be "broadly in line" with last year at constant currency rates, after the cost-cutting last year, but will increase by up to £40m at the reported level if rates if they remain as they currently are.
Water and wastewater company Severn Trent posted a trading update for the period from 1 April to 19 July on Wednesday, as it continued to focus on enhancing its customer service, operational and financial performance. The FTSE 100 firm said it is making good progress with its plans to deliver “targeted efficiency savings” in the second year of the AMP6 regulatory period.
Market Movers
FTSE 100 (UKX) 6,715.52 0.27%
FTSE 250 (MCX) 16,935.45 0.17%
techMARK (TASX) 3,403.84 0.35%
FTSE 100 - Risers
Admiral Group (ADM) 2,081.00p 1.76%
GKN (GKN) 284.40p 1.43%
HSBC Holdings (HSBA) 493.70p 1.35%
WPP (WPP) 1,675.00p 1.27%
Royal Bank of Scotland Group (RBS) 192.50p 1.26%
Worldpay Group (WI) (WPG) 292.90p 1.03%
Smith & Nephew (SN.) 1,305.00p 1.01%
St James's Place (STJ) 867.50p 0.99%
Old Mutual (OML) 204.20p 0.94%
Johnson Matthey (JMAT) 3,175.00p 0.89%
FTSE 100 - Fallers
Anglo American (AAL) 771.30p -5.20%
Glencore (GLEN) 175.35p -2.53%
BHP Billiton (BLT) 925.00p -2.48%
Rio Tinto (RIO) 2,325.00p -2.19%
Antofagasta (ANTO) 482.40p -1.59%
Fresnillo (FRES) 1,852.00p -1.33%
Berkeley Group Holdings (The) (BKG) 2,665.00p -1.15%
Randgold Resources Ltd. (RRS) 8,855.00p -0.95%
easyJet (EZJ) 1,110.00p -0.54%
Coca-Cola HBC AG (CDI) (CCH) 1,563.00p -0.32%
FTSE 250 - Risers
TalkTalk Telecom Group (TALK) 232.00p 4.18%
Wizz Air Holdings (WIZZ) 1,604.00p 3.95%
AO World (AO.) 139.40p 3.03%
Sophos Group (SOPH) 236.90p 2.60%
CYBG (CYBG) 248.90p 2.51%
TR Property Inv Trust (TRY) 291.30p 2.21%
Brown (N.) Group (BWNG) 182.80p 2.01%
Perpetual Income & Growth Inv Trust (PLI) 382.00p 1.60%
OneSavings Bank (OSB) 212.30p 1.58%
Kennedy Wilson Europe Real Estate (KWE) 983.50p 1.39%
FTSE 250 - Fallers
Man Group (EMG) 118.20p -3.35%
Hochschild Mining (HOC) 215.00p -3.20%
CMC Markets (CMCX) 280.00p -2.44%
Kaz Minerals (KAZ) 134.20p -2.12%
Evraz (EVR) 154.70p -2.09%
Countryside Properties (CSP) 230.40p -2.00%
Home Retail Group (HOME) 147.20p -1.74%
Polymetal International (POLY) 1,091.00p -1.62%
P2P Global Investments (P2P) 824.50p -1.61%
Ascential (ASCL) 246.00p -1.56%