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London open: Stocks edge higher ahead of retail sales, Fed announcement

By Michele Maatouk

Date: Wednesday 20 Sep 2017

London open: Stocks edge higher ahead of retail sales, Fed announcement

(ShareCast News) - London stocks edged tentatively higher in early trade on Wednesday as investors eyed the release of UK retail sales data and the latest policy announcement from the US Federal Reserve.
At 0830 BST, the FTSE 100 was up 0.2% to 7,287.82.

The Fed is widely expected to stand pat on interest rates, but the central bank may well outline plans to wind down its balance sheet.

David Morrison, senior market strategist at SpreadCo, said: "The FOMC will update its economic projections and give its latest forecasts for GDP growth, unemployment, inflation and interest rates.

"The Fed is also expected to reveal details of how and when it will begin to wind down its $4.5trn balance sheet. The Fed is aiming to reduce it to around $2-2.5trn by allowing $10 - $50 billion of bonds to mature each month without reinvesting the proceeds. The programme is expected to begin next month. So a $2trn reduction even at the higher $50bn per-month rate suggests a wind-down period of around four years. This sounds cautious enough. However, in just the same way that this form of quantitative easing had never been tried before, it follows that no one has ever attempted to reduce it either."

UK retail sales are at 0930 BST and the FOMC rate announcement is at 1900 BST.

On the corporate front, Kingfisher rallied after the B&Q owner posted better profits than were expected for the first half of the year but remained cautious on the second half backdrop in the UK and France.

Shire nudged just a touch lower saying that it and its Japanese partner Shionogi & Co Ltd on saw positive results from a phase III clinical trial of Intuniv in adults with attention deficit hyperactivity disorder.

Domino's Pizza gained ground after announcing a £15m share buyback programme and Cairn Energy edged higher as said a final hearing for its tax dispute with India has been scheduled for August 2018.

Going the other way, Diageo was in the red as it said it remained "well set up" to deliver in line with its own expectations but warned that the first-half organic net sales growth rate will be hit by the later timing of Chinese New Year and by the expected impact of the highway ban in India.

GlaxoSmithKline slipped a little even as it and Innoviva reported positive headline results from a phase-three impact study of Trelegy Ellipta, a triple-therapy inhaler for patients with chronic obstructive pulmonary disease.

Outsourcer Mitie was under the cosh as it said it will cut 480 jobs by the end of the year as a result of its transformation programme and that it is considering selling its property management division.

BTG fell after saying it has been ordered to pay $55.8m in damages plus interest and costs to Wellstat Therapeutics in a dispute over the distribution of Vistogard, an antidote to the overdose of two chemotherapy drugs.

Market Movers

FTSE 100 (UKX) 7,287.82 0.17%
FTSE 250 (MCX) 19,548.50 0.07%
techMARK (TASX) 3,436.85 0.16%

FTSE 100 - Risers

Kingfisher (KGF) 317.90p 7.25%
Sage Group (SGE) 713.00p 1.49%
Prudential (PRU) 1,775.00p 1.02%
BT Group (BT.A) 287.60p 0.91%
Next (NXT) 5,020.00p 0.84%
Croda International (CRDA) 3,778.00p 0.83%
Marks & Spencer Group (MKS) 342.80p 0.82%
Babcock International Group (BAB) 806.00p 0.75%
G4S (GFS) 279.70p 0.72%
Glencore (GLEN) 348.50p 0.69%

FTSE 100 - Fallers

Diageo (DGE) 2,460.00p -1.44%
Burberry Group (BRBY) 1,759.00p -1.07%
Lloyds Banking Group (LLOY) 65.55p -0.68%
CRH (CRH) 2,651.00p -0.67%
TUI AG Reg Shs (DI) (TUI) 1,280.00p -0.54%
Rio Tinto (RIO) 3,504.50p -0.38%
Coca-Cola HBC AG (CDI) (CCH) 2,531.00p -0.35%
Barclays (BARC) 187.75p -0.29%
Royal Bank of Scotland Group (RBS) 254.90p -0.23%
Hammerson (HMSO) 540.50p -0.18%

FTSE 250 - Risers

Millennium & Copthorne Hotels (MLC) 470.00p 3.36%
Domino's Pizza Group (DOM) 284.00p 3.24%
Clarkson (CKN) 2,897.00p 2.37%
Hikma Pharmaceuticals (HIK) 1,168.00p 1.57%
PayPoint (PAY) 929.50p 1.42%
Inmarsat (ISAT) 634.00p 1.36%
SIG (SHI) 184.40p 1.32%
Provident Financial (PFG) 746.00p 1.29%
Travis Perkins (TPK) 1,465.00p 1.24%
Aveva Group (AVV) 2,443.00p 1.24%

FTSE 250 - Fallers

Mitie Group (MTO) 249.40p -3.45%
Ibstock (IBST) 229.20p -2.76%
Lancashire Holdings Limited (LRE) 636.00p -2.53%
Rank Group (RNK) 222.00p -2.29%
Metro Bank (MTRO) 3,409.00p -2.26%
Euromoney Institutional Investor (ERM) 1,126.00p -2.09%
Hill & Smith Holdings (HILS) 1,226.00p -2.08%
BTG (BTG) 654.00p -1.95%
FDM Group (Holdings) (FDM) 987.50p -1.45%
CYBG (CYBG) 294.80p -1.40%


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