London close: Financials help FTSE perk up after three-day decline

Having hummed and hawed all day amid a buzz of UK corporate and global geopolitical news on Thursday, London's blue chip share index showed signs of life after being laid up for the first three days of the week.

Financial stocks put in a solid performance in line with the global financials sector, boosted by rising yields and a strong reading in the key US Philly Fed manufacturing gauge, which analysts said pointed to robust factory sector activity in the States going forward.

There was no major UK data releases due but in the US, the data was robust, with jobless claims, the import price index and the NY Empire State manufacturing also helping bolster sentiment.

The FTSE 100 closed the session up just 7.07 points or 0.099% higher at 7,139.76, still down more than 1% since the end of last week and 8.3% lower than the peaks of mid January.

Looking across the Atlantic, analyst Chris Beauchamp at IG in London said bulls were taking their turn in the spotlight as the concerns about the Trumpian tariff narrative were "becoming less of a worry" amid healthy numbers on the US economy.

Confirmation came through that former Reagan administration adviser turned TV pundit Larry Kudlow, who had been an informal economic adviser to President Trump's 2016 campaign, will replace Gary Cohn as the president's top economic adviser. Speaking to CNBC after his appointment, Kudlow ramped up trade war rhetoric as he called for the US to lead a coalition of nations to stand up to China.

But robust economic data helped lift Wall Street stock indices and although they perked up the dollar too, the pound ended the London session down 0.2% on the greenback at 1.3929. Sterling was up 0.25% against the euro 1.1317 however as investors weighed up rising tensions between the UK and Russia against some encouraging Brexit news.

Brexit Secretary David Davis, ahead of a meeting with EU counterpart Michel Barnier in Brussels on Monday, said deal on a transition period will be finalised before the end of the week. Meanwhile The Times has seen documents that indicate the UK will be free to sign trade deals during the transition period without permission from the European Union after a climbdown by Brussels.

The mood in the City of London had not been helped after Unilever announced it will move its corporate headquarters to Rotterdam from London as it combines its two classes of shares into a single entity.

Fellow consumer good group PZ Cussons, the maker of Imperial Leather soaps and shower gels, took a 17% tumble as it warned on profits. The company had reported in January that performance in the first half of the year was constrained by conditions in the UK and Nigeria, and that delivery of the full year result would be dependent on conditions in those markets for the balance of year. Today it said it was now apparent that profit for the full year would fall short of expectations.

Hammerson was under pressure as Credit Suisse cut the retail property developer to 'neutral' a day after Goldman Sachs added the group to its 'conviction buy' list.

Hammerson was also among those stocks going ex-dividend this Thursday, with other companies weighing on the index for the same reason included Anglo American, Crest Nicholson, Domino's Pizza, Essentra, Galliford Try, LondonMetric, Millennium & Copthorne, SSP, Spirent Communications and Tritax Big Box.

Gold miners were also losing a little of their lustre as the stronger dollar chipped away at prices of precious metals. Randgold, Fresnillo and Hochschild were among the fallers.

GKN retreated as its largest customer, Airbus, suggested it would withdraw custom from the engineer if it gets taken over by turnaround specialist Melrose International.

Housebuilder Persimmon slipped as it appointed Roger Devlin, currently chairman of pub group Marston's, as chairman with effect from 1 June. The company announced back in December that chairman Nicholas Wrigley and Jonathan Davie, chairman of the remuneration committee, has resigned amid anger over their failure to cap directors' earnings under a long-term incentive plan agreed in 2012.

OneSavings Bank was in the red despite posting a 21% jump in full-year profit as the loan book grew and saying it kicked off 2018 with a strong pipeline of new business, as guidance on margins disappointed.

Estate agency Savills declined as it said statutory pre-tax profit for 2017 rose 13% but warned that it expects "some tempering of the strong transaction volumes of recent times in some markets".

On the upside, consumer credit reporting agency Experian rallied as it agreed to buy credit-checking firm ClearScore for £275m. Experian said the acquisition will combine two well-know, high-growth UK consumer brands, both of which will be retained. It will also bring together two businesses with complementary assets and skills to improve outcomes for consumers.

Tesco was another gainer after JPMorgan Cazenove upgraded its stance on the stock 'overweight' from a previous rating of 'underweight' before the Booker offer.

Hikma Pharmaceuticals was lifted by an upgrade to 'buy' at Citi and to 'hold' at Jefferies, while TalkTalk rose on the back of an upgrade from Macquarie.

Old Mutual edged higher as it reported a 22% increase in underlying operating profits to £2bn as the Anglo-South African financial services group continued the process of splitting itself up.

Cineworld gained ground as it posted a 23% jump in full-year pre-tax profit while construction and services group Kier was up after reporting a rise in first-half profit and saying it expects double-digit profit growth in 2018.

Retirement products specialist Just Group rallied on the back of a 35% increase in 2017 operating profit Spirax-Sarco pushed higher on better-than-expected full-year results.

Market Movers

FTSE 100 (UKX) 7,139.76 0.10%
FTSE 250 (MCX) 19,828.41 0.04%
techMARK (TASX) 3,332.59 0.14%

FTSE 100 - Risers

Standard Life Aberdeen (SLA) 372.60p 1.83%
Tesco (TSCO) 214.00p 1.76%
Smiths Group (SMIN) 1,597.50p 1.75%
Hargreaves Lansdown (HL.) 1,729.00p 1.71%
Experian (EXPN) 1,610.50p 1.67%
St James's Place (STJ) 1,140.50p 1.65%
Direct Line Insurance Group (DLG) 390.20p 1.54%
Legal & General Group (LGEN) 262.10p 1.51%
Aviva (AV.) 521.00p 1.48%
Rentokil Initial (RTO) 276.20p 1.47%

FTSE 100 - Fallers

Hammerson (HMSO) 434.40p -4.86%
Micro Focus International (MCRO) 1,921.50p -2.63%
Randgold Resources Ltd. (RRS) 5,958.00p -2.14%
Fresnillo (FRES) 1,192.50p -1.93%
Morrison (Wm) Supermarkets (MRW) 212.07p -1.81%
GKN (GKN) 430.20p -1.71%
Unilever (ULVR) 3,756.00p -1.69%
Imperial Brands (IMB) 2,479.00p -1.69%
G4S (GFS) 251.00p -1.57%
Severn Trent (SVT) 1,770.50p -1.29%

FTSE 250 - Risers

Hikma Pharmaceuticals (HIK) 1,105.00p 18.95%
Spirax-Sarco Engineering (SPX) 6,100.00p 6.01%
Computacenter (CCC) 1,128.00p 5.82%
Daejan Holdings (DJAN) 6,340.00p 5.67%
TalkTalk Telecom Group (TALK) 109.40p 3.60%
John Laing Group (JLG) 254.60p 3.08%
Cineworld Group (CINE) 245.60p 2.25%
Nex Group (NXG) 670.50p 2.21%
Hiscox Limited (DI) (HSX) 1,524.00p 2.07%
Jardine Lloyd Thompson Group (JLT) 1,314.00p 2.02%

FTSE 250 - Fallers

PZ Cussons (PZC) 229.67p -16.26%
Hochschild Mining (HOC) 191.50p -6.95%
Auto Trader Group (AUTO) 360.60p -6.46%
OneSavings Bank (OSB) 381.80p -6.45%
Barr (A.G.) (BAG) 620.00p -5.57%
Crest Nicholson Holdings (CRST) 468.40p -5.18%
Essentra (ESNT) 460.00p -4.13%
IP Group (IPO) 103.00p -4.10%
Coats Group (COA) 78.30p -3.94%
Dignity (DTY) 945.50p -3.72%