FTSE 100 movers: Miners rally but easyJet flies lower again on downgrade

London’s FTSE 100 was up 0.6% to 7,041.16 in afternoon trade.

Randgold Resources was in the black, bouncing back from recent weakness as gold prices advanced.

Randgold, Anglo American, BHP Billiton and Glencore were also boosted by a note from Bank of America Merrill Lynch, which said the stocks were among its key ‘buy’ recommendations. Merrill upgraded its price assumptions for the metals and mining sector in zinc, nickel and coal.

On the downside, EasyJet flew lower for the second day in a row after Bank of America Merrill Lynch downgraded the low-cost carrier to ‘neutral’ from ‘buy’ and cut the price target to 1,050p from 1,300p given the increasing lack of visibility on pricing.

Merrill reckoned the shares have limited upside potential until there is capacity constraint and/or yield momentum stability.

It said the company’s fourth-quarter trading update on Thursday indicated that consensus full-year pre-tax profit needed to fall by around 20%. BofA’s own forecasts dropped to £400m from £575m, driven by lower pricing and slightly higher costs.

EZJ shares tanked on Thursday after it warned that profits for the year would be hit by the weakening of the pound.

Housebuilders were under the cosh after Halifax revealed UK house price growth eased in the three months to September. Prices rose an annualised 5.8% in the quarter to an average of £214,024 following a 6.9% year-on-year increase in the three months to August. It marked the slowest pace in more than three years and comes after Britain voted to leave the European Union on 23 June.

Barratt, Taylor Wimpey and Persimmon all fell.

Capita declined as UBS made material cuts to its estimate and slashed the price target to 675p from 1,125p, keeping its ‘neutral’ stance on the stock.

“Capita's profit warning last week crystallised the same fears that have seen investors gradually de-rate Capita over the past 10 years: market penetration offers little growth, technology is deflationary, and achievable margins are below legacy contract levels.”

Risers

Randgold Resources Ltd. (RRS) 7,180.00p 4.28%
Fresnillo (FRES) 1,672.00p 3.59%
BHP Billiton (BLT) 1,241.00p 3.24%
Glencore (GLEN) 220.75p 2.94%
Anglo American (AAL) 1,027.50p 2.91%
Burberry Group (BRBY) 1,465.00p 2.81%
Royal Dutch Shell 'A' (RDSA) 2,077.50p 2.62%
Mediclinic International (MDC) 911.50p 2.53%
Rio Tinto (RIO) 2,684.50p 2.48%
Royal Dutch Shell 'B' (RDSB) 2,174.50p 2.47%

Fallers

easyJet (EZJ) 885.50p -5.14%
ITV (ITV) 175.50p -4.62%
Barratt Developments (BDEV) 482.30p -4.50%
Next (NXT) 4,540.00p -4.36%
Taylor Wimpey (TW.) 147.30p -3.98%
Dixons Carphone (DC.) 348.60p -3.91%
Persimmon (PSN) 1,754.00p -3.78%
Capita (CPI) 609.00p -3.72%
Marks & Spencer Group (MKS) 318.60p -3.63%
Travis Perkins (TPK) 1,472.00p -3.60%