FTSE 100 movers: easyJet drops on profit warning; GKN boosted by HSBC note

London’s FTSE 100 index was flat at 7,033.69 in afternoon trade as investors sat on their hands ahead of Friday’s non-farm payrolls.

GKN got a lift as HSBC initiated coverage of the aerospace and automotive engineer at ‘buy’ with a 395p price target.

It pointed to a robust business, sustainable growth, improving returns and an undemanding valuation.

“We believe the equity story for GKN is a straight-forward one. It has world-leading technology, is an important supplier to major OEMs in its core end markets, and has exposure to structural growth drivers. This is compounded with the potential for the group to expand margins, improve earnings quality and thus enhance valuation multiples.”

On the downside, budget airline easyJet flew lower after warning that profits for the year would be hit by the weakening of the pound.

The company said foreign exchange movements are expected to have around a £90m adverse impact compared to the final year to 30 September, which is an increase of £35m since 23 June.

Smith & Nephew was under the cosh as Berenberg downgraded the stock to ‘hold’ from ‘buy’ saying it has become more cautious about the organic revenue growth outlook, margins and earnings growth.

Smith & Nephew was also weighed by the fact that its stock went ex-dividend on Thursday, along with Travis Perkins and Aviva.

Risers

Royal Bank of Scotland Group (RBS) 187.30p 1.90%
TUI AG Reg Shs (DI) (TUI) 1,134.00p 1.80%
GKN (GKN) 336.40p 1.57%
ITV (ITV) 186.50p 1.52%
Carnival (CCL) 3,841.00p 1.48%
Barclays (BARC) 174.75p 1.33%
Provident Financial (PFG) 3,298.00p 1.20%
Rolls-Royce Holdings (RR.) 763.00p 1.13%
Prudential (PRU) 1,443.50p 1.09%
Experian (EXPN) 1,589.00p 1.08%

Fallers

easyJet (EZJ) 950.00p -5.28%
Smith & Nephew (SN.) 1,220.00p -3.56%
Marks & Spencer Group (MKS) 327.40p -3.05%
Travis Perkins (TPK) 1,529.00p -2.43%
Capita (CPI) 640.00p -2.36%
International Consolidated Airlines Group SA (CDI) (IAG) 388.10p -2.19%
BT Group (BT.A) 374.15p -1.86%
Tesco (TSCO) 203.30p -1.83%
Aviva (AV.) 445.70p -1.70%
Intu Properties (INTU) 285.10p -1.69%