London close: FTSE ends lower after worse-than-estimated PMIs

Markit’s purchasing managers’ index on Eurozone manufacturing fell to 51.5 in April from 51.6 in March, falling short of estimates of 51.9. A reading above 50 signals an expansion in sector activity while a level below that indicates a contraction.

The PMI on Eurozone services also trailed expectations, rising to 53.2 in April from 53.1 in March, instead of the 53.3 that was predicted by analysts.

“Overall, the PMIs’ message of stationarity confirms the message from other data that gross domestic product growth in the Eurozone has settled at about 0.3%-to-0.4% quarter-on-quarter in recent quarters,” according to Pantheon Macroeconomics.

Stateside, Markit’s PMI on US manufacturing fell to 50.8 in April from 51.5 in March, compared to analysts’ projections of 52.0.

“A below expectations performance by US manufacturing will be cause for concern, particularly among those who had predicted the sector was heading towards growth,” said Dennis de Jong, managing director a UFX.com.

“The challenge for Janet Yellen and her colleagues at the Fed will be to build some momentum for a sector which has stubbornly avoided significant growth in recent months.”

The Federal Reserve is due to announce its latest policy decision next Wednesday when it is expected to keep interest rates unchanged.

Elsewhere, international lenders told Greece on Friday to prepare a package of additional savings measures as part of its reforms to help pave the way for more debt relief.

"We came to the conclusion that the policy package should include a contingent package of additional measures that would be implemented only if necessary to reach the primary surplus target for 2018," the chairman of euro zone finance ministers Jeroen Dijsselbloem told a news conference in Amsterdam after the ministers met.

In company news, mining stocks were the biggest fallers on the FTSE 100 including Glencore, Anglo American and Rio Tinto.

BHP Billiton's shares were also under pressure after saying it did not expect recent rise in iron ore and metallurgical coal prices to hold for more than a few months, as more low cost supply is set to hit the market.

Paddy Power Betfair continued to traipse lower for the third successive day after negative comments on the newly merged bookmaker from Credit Suisse earlier in the week.

Of the risers, the residential construction sector was building momentum, thanks in part to a positive note on the builders from broker Liberum, which upgraded Barratt Developments and Persimmon to 'hold' as it toned down its caution on the sector. Having come over all of a quiver on housebuilders in November due to stretched valuation and fears of margin pressure, Liberum was feeling more relaxed on the sector after its shares since subsided 13% due to worries about Brexit and prime London property.

Sainsbury's also rallied after a rating upgrade to ‘buy’ from Deutsche Bank - a sign those in the City were warming to the grocer’s mammoth takeover of Argos.

Tesco edged higher after Fitch upgraded its outlook on the recovering retail giant from ‘negative’ to ‘stable’.

Market Movers

FTSE 100 (UKX) 6,310.44 -1.11%
FTSE 250 (MCX) 16,871.46 -0.64%
techMARK (TASX) 3,120.99 -1.02%

FTSE 100 - Risers

Travis Perkins (TPK) 1,828.00p 1.22%
Sainsbury (J) (SBRY) 292.20p 1.18%
Tesco (TSCO) 186.60p 0.86%
Barratt Developments (BDEV) 514.00p 0.78%
Kingfisher (KGF) 363.30p 0.53%
Persimmon (PSN) 1,886.00p 0.21%
Whitbread (WTB) 3,889.00p 0.21%
Hargreaves Lansdown (HL.) 1,301.00p 0.15%
Randgold Resources Ltd. (RRS) 6,525.00p 0.15%
Dixons Carphone (DC.) 419.70p 0.14%

FTSE 100 - Fallers

Paddy Power Betfair (PPB) 8,375.00p -3.90%
Land Securities Group (LAND) 1,071.00p -3.34%
Glencore (GLEN) 161.30p -3.27%
Rio Tinto (RIO) 2,329.00p -3.14%
Smith & Nephew (SN.) 1,121.00p -2.78%
Old Mutual (OML) 193.20p -2.77%
Carnival (CCL) 3,462.00p -2.75%
Mondi (MNDI) 1,281.00p -2.73%
Associated British Foods (ABF) 3,140.00p -2.70%
GKN (GKN) 291.90p -2.67%

FTSE 250 - Risers

Ted Baker (TED) 2,423.00p 6.74%
Clarkson (CKN) 2,462.00p 3.75%
Ophir Energy (OPHR) 82.85p 3.24%
Telecom Plus (TEP) 900.50p 2.50%
CLS Holdings (CLI) 1,544.00p 2.25%
Beazley (BEZ) 333.00p 1.99%
QinetiQ Group (QQ.) 224.20p 1.96%
Tullett Prebon (TLPR) 348.50p 1.84%
Saga (SAGA) 205.00p 1.79%
Debenhams (DEB) 79.80p 1.79%

FTSE 250 - Fallers

Mitchells & Butlers (MAB) 270.50p -4.38%
Hays (HAS) 128.20p -3.68%
Petrofac Ltd. (PFC) 870.00p -3.49%
Essentra (ESNT) 860.00p -3.48%
Smith (DS) (SMDS) 383.00p -3.48%
Moneysupermarket.com Group (MONY) 303.30p -3.47%
LondonMetric Property (LMP) 157.60p -2.60%
Victrex plc (VCT) 1,539.00p -2.59%
Elementis (ELM) 228.50p -2.48%
National Express Group (NEX) 326.50p -2.45%