London open: FTSE down on Greece angst and end-of-month effect

London's equity indices were in the red on Friday as concerns about Greek debt negotiation combined with end-of-month selling.

The FTSE 100 was down 0.51% to 7,005.4 points at a quarter past nine on Friday morning, in line with falls across Europe.

A Greek official said late on Thursday that the government intends to reach a deal on cash-for-reforms by Sunday, but comments from Eurozone officials have suggested that a deal is still a way off, while IMF chief Christine Lagarde said Greece could leave the euro if a deal isn’t reached.

End of month trading, which has seen outflows on the last day of trading over the last six months, was also cited by traders as having an effect. The concept has been dubbed 'Costanza trading' by futures trader Nicola Duke, named after the hapless George Costanza character in sitcom Seinfeld.

Chris Beauchamp at IG added: "End of month movements have been to the downside so far this year, and I think given the uncertainty that attends the next six months re Greece and US rates most people seem keen to get what they can by the end of the month."

With the focus still firmly on Greece, better-than-expected data out of Germany failed to provide a boost to markets.
Figures from the Federal Statistics Office showed that retail sales rose by 1.7% on the month in April, beating analysts’ expectations for a 0.8% increase. On a year-on-year basis, sales were up 1%.

"Better than expected retail sales in April owed much to stronger food sales,” said Dominic Bryant, European economist at BNP Paribas. “However, regardless of the source, the positive start to Q2 means that while spending is slowing as the impact of the boost to income from last year’s sharp fall in the oil price continues to fade, spending is not collapsing in the way the March drop in retail sales might have implied."

The day ahead sees the revised reading of US first quarter GDP the only notable release at 13:30 with expectations for a contraction on the year. This is expected to be revised lower to -0.8% from the initial reading of 0.2%.

Smaller data prints include the Chicago PMI at 14:45 looking for a local improvement in May, University of Michigan Confidence also looking up. The Baker Hughes Rig Count rounds off the afternoon at 18:00.

Individual stock movements

Topping the FTSE 100 was Associated British Foods after Goldman Sachs upgraded its shares to ‘buy’ from ‘sell’ and raised the price target to 3120p from 2755p, saying that the stock’s 17% underperformance year-to-date offers an attractive entry point.

US data centre company Equinix has agreed to acquire British peer TeleCity Group in bid that would create the largest data centre player in Europe, though Telecity's shares were down slightly on the confirmation. Telecity has agreed to terminate another merger it had agreed with Interxion on 9 March. The price agreed represents a value of approximately 1,145p per Telecity share and a total value of approximately £2.35bn.

Synergy Health was down 1.9% as it confirmed that the Federal Trade Commission (FTC) had informed that it intends to seek to block the proposed merger. The two companies have now announce that they will contest the FTC's attempt to block their proposed combination.

Integrated support services company Carillion was up slightly after acquiring Canadian camping group Outland for £63m. Carillion chief executive Richard Howson said: “Acquiring Outland is another important strategic step in the development of our support services business in Canada.”

Market Movers
techMARK 3,320.11 -0.28%
FTSE 100 7,017.29 -0.34%
FTSE 250 18,198.93 -0.21%

FTSE 100 - Risers
Associated British Foods (ABF) 3,036.00p +2.92%
Weir Group (WEIR) 2,030.00p +2.73%
Fresnillo (FRES) 750.50p +1.35%
GlaxoSmithKline (GSK) 1,475.50p +1.06%
Randgold Resources Ltd. (RRS) 4,727.00p +0.96%
Aviva (AV.) 530.50p +0.47%
Sainsbury (ninja) (SBRY) 258.40p +0.47%
Vodafone Group (VOD) 254.85p +0.45%
Royal Dutch Shell 'A' (RDSA) 1,959.50p +0.28%
Royal Dutch Shell 'B' (RDSB) 1,990.00p +0.25%

FTSE 100 - Fallers
Sage Group (SGE) 567.50p -1.73%
Barratt Developments (BDEV) 591.00p -1.58%
SABMiller (SAB) 3,525.00p -1.37%
Taylor Wimpey (TW.) 182.40p -1.30%
Ashtead Group (AHT) 1,146.00p -1.29%
Old Mutual (OML) 223.60p -1.28%
British American Tobacco (BATS) 3,644.50p -1.27%
International Consolidated Airlines Group SA (CDI) (IAG) 562.00p -1.23%
Land Securities Group (LAND) 1,317.00p -1.05%
Diageo (DGE) 1,822.50p -1.03%

FTSE 250 - Risers
Ophir Energy (OPHR) 133.60p +5.03%
Infinis Energy (INFI) 186.40p +3.33%
Petrofac Ltd. (PFC) 909.00p +2.25%
Wood Group (John) (WG.) 746.00p +1.91%
Countrywide (CWD) 599.50p +1.70%
AO World (AO.) 176.00p +1.44%
FirstGroup (FGP) 115.10p +1.32%
Centamin (DI) (CEY) 69.40p +1.31%
Spire Healthcare Group (SPI) 354.60p +1.14%
Indivior (INDV) 232.30p +1.09%

FTSE 250 - Fallers
Ocado Group (OCDO) 368.00p -2.70%
Evraz (EVR) 169.40p -2.42%
IP Group (IPO) 211.70p -2.40%
Investec (INVP) 599.00p -2.12%
Synergy Health (SYR) 1,859.00p -1.90%
Fidessa Group (FDSA) 2,238.00p -1.80%
Renishaw (RSW) 2,471.00p -1.40%
Bwin.party Digital Entertainment (BPTY) 105.50p -1.40%
Crest Nicholson Holdings (CRST) 533.00p -1.30%
Premier Farnell (PFL) 190.90p -1.29%