London open: FTSE flat ahead of UK retail sales data

A mixed reaction to corporate earnings and a number of blue chips going ex-dividend weighed on UK stock markets on Thursday morning, with the Footsie opening broadly flat.

The FTSE 100 was trading 0.01% lower at 7,006.62 early on.

Concerns about Greece continued to rumble on in the background following comments from the German finance minister that he could not rule out a Greek default.

Meanwhile, ratings agency Moody's has warned Athens that without an agreement over a cash-for-reforms deal with creditors, the government will have to impose capital controls on its banks to stem an outflow of funds.

According to reports, Greek prime minister Alexis Tsipras is expected to present a debt-restructuring proposal at a two-day summit of EU leaders which starts on Thursday in Riga.

As for the economic data schedule, manufacturing figures from across the globe will be in focus as Markit presents its May 'flash' purchasing managers' indices (PMIs) for the Eurozone and US.

The flash Eurozone manufacturing PMI jumped to a 13-month high of 52.3, better than consensus expectations for a reading of 51.8, but the services PMI dropped to a 4-month low of 53.3 and fell short of expectations for a reading of 53.9.

German PMIs manufacturing and service data were both disappointing, with manufacturing printing at a 3-month low of 51.4 in May from 52.1 in April, while the services PMI came in at 52.9 from 54 in April, marking a 5-month low. Earlier, data from Markit showed that the French private sector expanded at a moderate pace in May.

Meanwhile, the HSBC China manufacturing PMI released overnight rose from 48.9 to 49.1 this month, showing that the rate of decline - measured by any figure below 50 - had slowed, though it still missed the consensus forecast of 49.3.

Spreadex analyst Connor Campbell said the FTSE 100 was continuing its flat performance that it has shown all week.

"If the UK index really wants to break into the kind of rally that has been absent from British shores of late, then it will need to see a strong performance from its retail sales figures after that disastrous decline last month, alongside an improvement in its CBI industrial order expectations," he said.

UK retail sales data, due out at 09:30, is expected to show a 0.4% increase in volumes in April after a 0.5% drop in March

Ex-div stocks provide a drag

Bunzl, Carnival, HSBC, Intertek and Taylor Wimpey all went ex-dividend on Thursday, collectively taking 6.41 points off the FTSE 100.

Nevertheless, mining stocks were doing the best to buoy the index with Fresnillo, BHP Billiton, Rio Tinto and Antofagasta all on the rise.

Royal Mail was flat after meeting forecasts with its annual profits but giving a somewhat cautious statement on the highly competitive market. Full-year revenues were just about flat at £9.3bn, with pre-tax profit slumping by more than two thirds, as expected, to £400m.

Technology outfit Smiths Group edged higher after reiterating guidance for full-year growth in spite of a weakening of underlying results over the first three quarters.

Electricity and gas utility group National Grid hailed "another successful year" as it beat forecasts with an 11% increase in adjusted annual profits, though investors were left underwhelmed with smaller-than-expected increase in the dividend.

Food wholesaler Booker jumped after signing a sale and purchase agreement to acquire the entire issued share capital of Musgrave Retail Partner, which comprises the Londis and Budgens businesses, for £40m.

Market Movers
techMARK 3,275.77 +0.10%
FTSE 100 7,006.62 -0.01%
FTSE 250 18,088.63 -0.26%

FTSE 100 - Risers
Sports Direct International (SPD) 665.00p +2.15%
Fresnillo (FRES) 775.00p +2.11%
BHP Billiton (BLT) 1,417.50p +1.58%
Antofagasta (ANTO) 789.00p +1.28%
Rio Tinto (RIO) 2,903.50p +1.27%
Anglo American (AAL) 1,077.50p +1.22%
Tesco (TSCO) 223.10p +1.18%
Sage Group (SGE) 582.00p +1.13%
Weir Group (WEIR) 1,906.00p +0.95%
Royal Dutch Shell 'A' (RDSA) 1,988.00p +0.91%

FTSE 100 - Fallers
Taylor Wimpey (TW.) 182.80p -4.69%
Burberry Group (BRBY) 1,688.00p -1.69%
Intertek Group (ITRK) 2,590.00p -1.63%
Bunzl (BNZL) 1,868.00p -1.63%
International Consolidated Airlines Group SA (CDI) (IAG) 558.50p -1.50%
British Land Company (BLND) 863.00p -1.48%
Carnival (CCL) 3,154.00p -1.47%
easyJet (EZJ) 1,628.00p -1.27%
HSBC Holdings (HSBA) 615.40p -1.20%
Land Securities Group (LAND) 1,324.00p -1.05%

FTSE 250 - Risers
Booker Group (BOK) 166.80p +9.74%
QinetiQ Group (QQ.) 229.30p +6.55%
Electra Private Equity (ELTA) 3,280.00p +5.40%
Bwin.party Digital Entertainment (BPTY) 108.90p +5.32%
Kaz Minerals (KAZ) 252.40p +3.95%
Vedanta Resources (VED) 664.50p +3.18%
Hunting (HTG) 596.50p +2.84%
Zoopla Property Group (WI) (ZPLA) 229.20p +2.60%
Bank of Georgia Holdings (BGEO) 1,854.00p +2.54%
Wood Group (John) (WG.) 728.50p +2.03%

FTSE 250 - Fallers
Electrocomponents (ECM) 237.50p -4.77%
Clarkson (CKN) 2,410.00p -4.17%
Dairy Crest Group (DCG) 500.50p -3.38%
Just Eat (JE.) 433.50p -3.02%
Inchcape (INCH) 867.50p -2.96%
Premier Farnell (PFL) 192.70p -2.87%
Provident Financial (PFG) 3,026.00p -2.86%
Computacenter (CCC) 727.00p -2.81%
Redefine International (RDI) 56.50p -2.33%
Home Retail Group (HOME) 165.60p -2.24%