London midday: Korea, data, dividends all press stocks lower

London stocks stumbled lower as Thursday's session was dogged by continued geopolitical tensions over the US-North Korea situation, uninspiring UK economic data and a heavyweight bunch of stocks going ex-dividend.

Not long after midday, the FTSE was down 1.17% to 7,410.07, with the more domestically focused FTSE 250 down 0.4%.

The pound was up 0.3% against the euro at 1.1091 and down almost 0.1% on the dollar at 1.2994.

Stocks were extending earlier losses as futures pointed to further losses on Wall Street. "This is not the first time the markets are playing the off-again, on-again scenario," said analyst Naeem Aslam at Think Markets, that’s why the uncertainty in equities has eased down faster, especially if compared to yesterday’s sell off.

"With the North Korean authorities taking the heat off the nuclear threats, we expect the market pressure to cool off, as long as the US President also manages to read “truce” between the lines.

Mike van Dulken at Accendo Markets said: “Equities remain under pressure from geopolitical tensions -- albeit calmer -- but are also being impacted by ex-dividends and macro data. The UK FTSE has broken lower following a disappointing trio of mixed UK industrial/manufacturing production, another construction output decline and a wider trade deficit."

The Office for National Statistics reported that overall industrial production rose 0.5% in June on the preceding month, stronger than the 0.1% that the agency had calculated in for its preliminary estimate for the second quarter, after May's production was revised to flat.

Manufacturing production in Jun was flat, as predicted, after falling 0.1% in May, while UK construction output badly missed forecasts fell 0.1% month on month and rose 0.9% year-on-year.

Companies going ex-dividend on Thursday trimmed 41.3 points off the index, with names including Anglo American, AstraZeneca, Barclays, BT, GSK, Lloyds, Rio Tinto and Royal Dutch Shell.

Data released overnight by RICS was weighing on housebuilding stocks, with the figures suggesting that declines are starting to spread beyond London as political uncertainty and tax changes weigh on the top end of the market. Taylor Wimpey led the fallers, followed by Barratt Developments, Persimmon, Bellway, Bovis and St Modwen.

Among company results, Prudential easily beat analysts' profit forecasts at the half-year stage thanks to strong trading in Asia and said it had met its target for surplus cash generation ahead of schedule. Operating profits were 5% higher to £2.4bn (consensus: £2.02bn) on an IFRS basis and at constant exchange rates but 15% ahead at current exchange rates. PRU shares were down modestly though.

Interim results from FTSE 100 listed drinks bottler Coca Cola Hellenic lifted its shares as they came in comfortably ahead of market expectations.

Travel operator TUI was flying slightly higher after reporting on a strong third quarter performance, with sales and profits taking off during the early summer months, although it left its full year targets unchanged.

Cineworld was higher as interims came in slightly above forecasts, with new openings on track and a strong second-half film slate underpinning full year expectations.

Commercial and residential estate agency Savills was on the up as it reported strong first half results as Asia and London office sales offset a decline in the UK housing market.

Also rising was oil and gas services company Amec Foster Wheeler as pre-tax swung to a profit of £77m from a loss of £446m a year earlier, though.

Card Factory investors were celebrating as the retailer reported a 3.1% increase in first half like-for-like sales after opening 30 new stores during the period.

Market Movers

FTSE 100 (UKX) 7,410.07 -1.17%
FTSE 250 (MCX) 19,791.16 -0.42%
techMARK (TASX) 3,395.19 -0.54%

FTSE 100 - Risers

Coca-Cola HBC AG (CDI) (CCH) 2,556.00p 7.71%
Worldpay Group (WPG) 396.30p 2.01%
Convatec Group (CTEC) 296.20p 1.13%
BAE Systems (BA.) 587.00p 0.77%
Micro Focus International (MCRO) 2,113.00p 0.76%
Associated British Foods (ABF) 3,172.00p 0.54%
Mondi (MNDI) 1,994.00p 0.50%
Mediclinic International (MDC) 739.50p 0.48%
Royal Bank of Scotland Group (RBS) 260.30p 0.46%
United Utilities Group (UU.) 932.50p 0.43%

FTSE 100 - Fallers

BT Group (BT.A) 301.55p -3.75%
Rio Tinto (RIO) 3,494.50p -2.90%
Anglo American (AAL) 1,269.00p -2.83%
InterContinental Hotels Group (IHG) 4,047.00p -2.81%
Diageo (DGE) 2,468.00p -2.59%
Lloyds Banking Group (LLOY) 65.22p -2.53%
Royal Dutch Shell 'B' (RDSB) 2,195.00p -2.29%
Royal Dutch Shell 'A' (RDSA) 2,164.00p -2.21%
BP (BP.) 458.85p -2.13%
Glencore (GLEN) 332.90p -2.03%

FTSE 250 - Risers

Greggs (GRG) 1,169.00p 4.66%
Cineworld Group (CINE) 724.00p 3.06%
Aldermore Group (ALD) 227.60p 3.03%
Amec Foster Wheeler (AMFW) 450.30p 2.74%
Ultra Electronics Holdings (ULE) 1,939.00p 2.32%
Wood Group (John) (WG.) 617.50p 2.24%
Card Factory (CARD) 331.30p 2.19%
TalkTalk Telecom Group (TALK) 197.10p 2.07%
Softcat (SCT) 397.10p 1.69%
Tullow Oil (TLW) 176.10p 1.67%

FTSE 250 - Fallers

Ibstock (IBST) 234.90p -5.24%
Hill & Smith Holdings (HILS) 1,364.00p -4.41%
Greene King (GNK) 674.00p -3.44%
St. Modwen Properties (SMP) 338.50p -3.18%
Go-Ahead Group (GOG) 1,745.00p -3.16%
PZ Cussons (PZC) 347.20p -2.94%
Northgate (NTG) 430.30p -2.89%
Acacia Mining (ACA) 184.60p -2.79%
TP ICAP (TCAP) 484.60p -2.59%
CLS Holdings (CLI) 201.90p -2.42%