London close: FTSE ends in the red as airlines hit by Ryanair Brexit warning
London stocks ended in the red on Monday, with airlines under the cosh as Ryanair warned over the potential fallout from Brexit.
The FTSE 100 ended down 1% at 7,377.73. Meanwhile, the pounded traded up 0.2% against the dollar at 1.3022 and 0.5% higher versus the euro at 1.1192. The index tends to take a hit when sterling is stronger, as around 70% of its constituents derive their earnings from overseas.
Also weighing on the mood was the International Monetary Fund's decision to cut its forecast for UK gross domestic product growth to 1.7% for this year from a previous estimate of 2% and for the US to 2.1% from 2.3%.
Meanwhile, oil was in focus amid a meeting between Opec and non-Opec oil producers in St Petersburg, as they discuss their next move to address the global supply glut and its effect on oil prices.
Among individual companies, sub-prime lender Provident Financial gave up all of last week's gains ahead of its interim results later this week, which will be the first since last month’s profit warning.
EasyJet and British Airways owner IAG were among the big fallers as rival Ryanair warned on the tough pricing environment that will see average fares drop in the second half, even though the Irish carrier announced a huge jump in quarterly profits.
Non-life insurers Direct Line and Admiral were lower against a sector backdrop that included a report from the AA that car insurance premiums have risen nearly 20% in the past year to a 23-year high, with warnings of a possible rise in Insurance Premium Tax in this year Budget. Prices have been forced up due to government's steep hike in February of a formula used to calculate personal injury compensation, more than doubling payouts for life-changing injuries. Cheap insurance policies are typically loss leading for insurers. Michael Lloyd, the AA’s insurance director, said: “I fear that the Chancellor may once again target IPT in the autumn Budget as a quick win to fill in some of the government’s financial potholes.”
Gold miner Acacia, already under pressure due to a long-running spat with the Tanzanian government, ended the day down more than 25% as it is now facing a lawsuit in the UK from relatives of people who died at one of its mines in the east African country.
Reckitt Benckiser fell as it reported results amid "tough" market conditions and slightly weaker profit margins from newly acquired baby food business Mead Johnson Nutrition.
Clothes retailer Next was down after analysts at RBC Capital Markets reduced their target price for the shares to 4,000p from 4,300p.
Randgold Resources was in the red as it continued to ramp up production at its Tongon gold mine in Côte d'Ivoire, tracking towards its 2017 target of 285,000 ounces.
B&M European Value Retail rallied on rumours in the papers that Walmart-owned Asda is eyeing up the discounter.
Meat products producer Cranswick was trotting higher as it churned out impressive revenue growth in the first quarter of the year and stated its confidence of hitting full year targets.
Real estate investment trust Tritax Big Box edged slightly higher as the warehouse investor said it had bought the freehold of the former Littlebrook Power Station site i east London for £65m, funded by equity.
Market Movers
FTSE 100 (UKX) 7,377.73 -1.01%
FTSE 250 (MCX) 19,616.25 -0.68%
techMARK (TASX) 3,512.61 -0.49%
FTSE 100 - Risers
Micro Focus International (MCRO) 2,227.00p 1.46%
Anglo American (AAL) 1,104.50p 1.19%
Burberry Group (BRBY) 1,652.00p 0.55%
Standard Chartered (STAN) 817.60p 0.48%
GKN (GKN) 327.20p 0.34%
Rolls-Royce Holdings (RR.) 925.00p 0.33%
HSBC Holdings (HSBA) 737.20p 0.29%
Barclays (BARC) 205.50p 0.22%
Shire Plc (SHP) 4,164.50p 0.19%
Informa (INF) 675.50p 0.07%
FTSE 100 - Fallers
Reckitt Benckiser Group (RB.) 7,623.00p -3.27%
Next (NXT) 3,710.00p -3.06%
Provident Financial (PFG) 2,297.00p -2.92%
St James's Place (STJ) 1,184.00p -2.87%
easyJet (EZJ) 1,275.00p -2.82%
Convatec Group (CTEC) 305.00p -2.62%
Admiral Group (ADM) 2,000.00p -2.58%
Severn Trent (SVT) 2,188.00p -2.54%
Old Mutual (OML) 195.00p -2.35%
Coca-Cola HBC AG (CDI) (CCH) 2,199.00p -2.27%
FTSE 250 - Risers
Carillion (CLLN) 63.35p 5.67%
B&M European Value Retail S.A. (DI) (BME) 357.50p 4.87%
Ferrexpo (FXPO) 224.70p 4.86%
Ascential (ASCL) 350.00p 4.04%
Drax Group (DRX) 327.00p 3.58%
Cranswick (CWK) 2,934.00p 3.20%
Aggreko (AGK) 863.00p 2.68%
Sophos Group (SOPH) 474.50p 2.44%
Cobham (COB) 136.10p 2.33%
Sports Direct International (SPD) 361.10p 2.27%
FTSE 250 - Fallers
Acacia Mining (ACA) 184.50p -20.61%
Petra Diamonds Ltd.(DI) (PDL) 102.80p -6.38%
Capital & Counties Properties (CAPC) 292.20p -2.99%
CLS Holdings (CLI) 202.00p -2.95%
Petrofac Ltd. (PFC) 459.10p -2.73%
Genus (GNS) 1,711.00p -2.73%
Woodford Patient Capital Trust (WPCT) 103.20p -2.64%
Capita (CPI) 656.50p -2.60%
Pennon Group (PNN) 804.00p -2.43%
Mitie Group (MTO) 262.40p -2.42%