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London open: Stocks push higher on positive US cues; Galliford Try tumbles

By Michele Maatouk

Date: Wednesday 14 Feb 2018

London open: Stocks push higher on positive US cues; Galliford Try tumbles

(ShareCast News) - London equity markets rose in early trade on Wednesday, taking their cue from another positive close on Wall Street as investors looked ahead to key US inflation figures.
At 0830 GMT, the FTSE 100 up 0.6% to 7,209.92, while the pound was down 0.1% against the dollar at 1.3881 and 0.2% lower versus the euro at 1.1226.

CMC Markets analyst Michael Hewson said: "If investors were concerned about the rapid return of inflation yesterday's market price action certainly didn't reflect that, as European investors adopted a fairly low risk approach after two day days of gains with some modest profit taking.

"US markets also opened on the back foot but gained confidence in the afternoon session on the back of comments from new Fed chair Jerome Powell who stated that the central bank would remain alert to any financial stability risks. This helped US markets finish the day in positive territory for the third day in succession though the gains were fairly modest in comparison to the previous few days."

With no major UK data releases due, all eyes will be on the US, where the consumer price index for January is out at 1330 GMT, along with retail sales.

Hewson said: "Today's US CPI inflation report has taken on an importance all of its own in the wake of the recently strong wages numbers, never mind the fact that the Fed doesn't even use CPI to target inflation.

"Nonetheless this renewed focus on inflation, not only in the US but more globally has raised concerns that central banks may well be behind the curve when it comes to assessing the outlook for the next few months."

In corporate news, Coca Cola HBC rallied as it reported full year earnings before interest and tax (EBIT) of €621m, a rise of 20% on net sales revenue of £6.5bn, up 4.9%.

Sky and BT were both on the front foot as they picked up the rights to the Premier League for £4.46bn.

Engineer GKN, which is currently fighting off a hostile bid from turnaround specialist Melrose Industries, was in the black after saying it is targeting a cash return of up to £2.5bn to shareholders over the next three years.

The knock-on effects of Carillion's collapse were being felt, as Galliford Try tumbled after announcing a £150m capital raising to cover the impact. The announcement came alongside the firm's latest interims and a decision to pay out a dividend of 28p for the six months to 31 December, versus 32p in the first half of 2017.

However, Serco advanced after saying it has signed a revised purchase agreement with Carillion's liquidators allowing it to buy some of the company's UK healthcare facilities management business for £29.7m, down from a previously agreed price of £47.7m.

Sirius Minerals gained after entering into a design and build contract with shaft sinking and mining contractor DMC Mining Services for the construction of the four shafts required for its polyhalite project in North Yorkshire.

Spirax-Sarco Engineering nudged up after it said chairman Bill Whiteley plans to retire from the board in May and will be succeeded by senior independent director Jamie Pike.

CYBG was boosted by an upgrade to 'sector perform' at RBC Capital Markets, but Virgin Money was hit by a downgrade to 'underperform' by the same outfit.

Aviva was higher after an upgrade to 'buy' at Goldman Sachs, while TalkTalk edged up after an upgrade to 'hold' at Societe Generale.

Irn Bru maker AG Barr slid after JPMorgan cut the stock to 'underweight'.

Market Movers

FTSE 100 (UKX) 7,209.92 0.58%
FTSE 250 (MCX) 19,399.47 0.41%
techMARK (TASX) 3,256.23 0.38%

FTSE 100 - Risers

Sky (SKY) 1,095.00p 3.20%
Coca-Cola HBC AG (CDI) (CCH) 2,296.00p 2.68%
HSBC Holdings (HSBA) 749.10p 1.95%
3i Group (III) 903.00p 1.71%
Aviva (AV.) 497.80p 1.61%
Pearson (PSON) 663.40p 1.59%
Old Mutual (OML) 235.90p 1.51%
British American Tobacco (BATS) 4,447.00p 1.49%
Evraz (EVR) 365.60p 1.39%
GKN (GKN) 403.50p 1.38%

FTSE 100 - Fallers

TUI AG Reg Shs (DI) (TUI) 1,576.50p -2.32%
Kingfisher (KGF) 355.40p -0.39%
GlaxoSmithKline (GSK) 1,289.00p -0.15%
BHP Billiton (BLT) 1,530.00p -0.10%
National Grid (NG.) 736.20p -0.08%
Smurfit Kappa Group (SKG) 2,476.00p -0.08%
BP (BP.) 475.60p -0.07%
BAE Systems (BA.) 569.40p -0.04%
Compass Group (CPG) 1,517.00p -0.00%
Royal Dutch Shell 'B' (RDSB) 2,308.00p 0.02%

FTSE 250 - Risers

IG Group Holdings (IGG) 804.50p 2.29%
Genus (GNS) 2,320.00p 2.02%
Sirius Minerals (SXX) 22.60p 1.99%
Jupiter Fund Management (JUP) 544.80p 1.79%
Hochschild Mining (HOC) 224.45p 1.65%
Spirax-Sarco Engineering (SPX) 5,545.00p 1.65%
TalkTalk Telecom Group (TALK) 108.00p 1.60%
CYBG (CYBG) 306.40p 1.52%
Dechra Pharmaceuticals (DPH) 2,284.00p 1.42% Group (MONY) 324.50p 1.41%

FTSE 250 - Fallers

Galliford Try (GFRD) 830.50p -15.90%
Barr (A.G.) (BAG) 641.00p -2.88%
Virgin Money Holdings (UK) (VM.) 264.10p -2.40%
Balfour Beatty (BBY) 265.60p -2.28%
F&C Commercial Property Trust Ltd. (FCPT) 140.15p -1.30%
FDM Group (Holdings) (FDM) 871.00p -1.02%
Kier Group (KIE) 1,079.00p -0.83%
Capita (CPI) 182.00p -0.79%
Sequoia Economic Infrastructure Income Fund Limited (SEQI) 106.20p -0.75%
BGEO Group (BGEO) 3,384.00p -0.70%


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