Earnings-day blues drags UK shares down
LONDON – Top UK shares opened on a downbeat note on Tuesday, with a mixed bag of corporate earnings and weakness in the technology sector offsetting reports of activist stake-building.
The FTSE 100 index was down 0.4 percent at 0804 GMT (0904), broadly in line with peers across Europe, though it has so far this year underperformed the region as a commodities sell-off and worries over China demand weigh on London-listed mining and energy shares.
While early trading on Tuesday saw something of a rebound for miners, with investors focusing on their ability to cut spending in the face of the commodity price drop, sluggish trade kept energy stocks such as BG Group and BP in negative territory.
Technology stocks including ARM Holdings were also weak after rocky Asia trading that saw Apple suppliers fall.
“The continuation of this commodity drag has meant the UK index underwent another lifeless open,” said Connor Campbell, analyst at Spreadex.
Home-improvement company Travis Perkins was among the FTSE 100’s worst performers after it published a trading update that it said was in line with forecasts, though some analysts said the figures were disappointing.
Insurer Standard Life saw first-half profits dented by a drop in sales of fixed-rate annuities. The shares fell nearly 3 percent. International Airlines Group also fell after reiterating annual growth but slightly reduced capacity growth.
Bottling company Coca-Cola HBC fell after a broker downgrade from Goldman Sachs, which cited pressures on revenue growth and profitability and a lack of takeover potential.
Deal hopes were much stronger with Smiths Group, whose shares jumped more than 6 percent on reports of stake-building in Smiths Group.
Royal Bank of Scotland enjoyed small gains after news that Britain had sold a 2.1 billion pound ($3.3 billion) stake to kick off the disposal of its holding seven years after bailing out the bank. -Reuters