London open: Stocks edge lower, Just Eat tumbles as rival gets Amazon backing

London stocks edged lower in early trade on Friday following solid gains in the previous session, amid renewed concerns about a possible hard Brexit.

At 0830 BST, the FTSE 100 was off 0.3% at 7,330.39, while the pound was down 0.1% against the dollar at 1.2784 - falling below $1.28 for the first time since February - and 0.2% lower versus the euro at 1.1432 as Brexit talks between the government and Labour looked set to collapse.

Sterling was knocked lower on Thursday as Prime Minister Theresa May agreed to set out the date of her departure in the first week of June after she makes one final attempt at getting her Brexit deal through parliament. Meanwhile, former Foreign Secretary and leading Brexiteer Boris Johnson confirmed he would run for the Tory Party leadership once May stood down.

London Capital Group analyst Jasper Lawler said: "Given the Tories' sharp losses in the polls and the Brexit party’s dominance in polling for European elections, a hard-line Brexiteer Prime Minister is becoming more likely.

"The overriding fear for currency traders is that this means that a hard no deal Brexit is back on the table as an option. Soft Brexit optimism is fading, pulling the pound lower."

In equity markets, Just Eat was the biggest loser on the FTSE 100 after it emerged that Amazon will make a big investment in rival Deliveroo. No exact figures were given but Deliveroo said Amazon will be the largest investor in its $575m funding round.

Accounting software company Sage saw its shares drop after it posted a decline in first-half adjusted operating profit but said revenue growth for 2019 is expected to be at the top end or slightly above its guidance range.

Cairn Energy was on the back foot as it said group production for 2019 remains within guidance of 19,000-22,000 barrels of oil equivalent per day for the first four months of the year.

On the upside, EasyJet flew higher as it left its 2019 profit expectations unchanged but warned of tougher trading conditions as it said losses before tax widened to £272m in the first half from £68m the year before. British Airways and Iberia parent International Consolidated Airlines Group was also a high riser.

Metro Bank shares surged after the challenger bank said it raised £375m in less than three hours after launching a discounted 500p a share placing late on Thursday. This was £25m more than it had set out to raise.

The Prudential Regulation Authority put out a statement welcoming the steps taken by the bank: "Metro Bank is profitable and continues to have adequate capital and liquidity to serve its current customer base. It has raised additional capital in order to fund future growth," it said.

Hikma Pharmaceuticals nudged higher after saying it made a good start to 2019, with healthy demand across its businesses, and that it was on track to meet its guidance for financial performance in the current year.

Shares in the Restaurant Group rallied after the Wagamama and Frankie & Benny's owner said total sales rose 57% in the 19 weeks to 12 May.

Market Movers

FTSE 100 (UKX) 7,330.39 -0.31%
FTSE 250 (MCX) 19,523.54 -0.04%
techMARK (TASX) 3,535.11 -0.26%

FTSE 100 - Risers

easyJet (EZJ) 1,033.00p 6.17%
International Consolidated Airlines Group SA (CDI) (IAG) 510.20p 1.63%
Rio Tinto (RIO) 4,659.50p 1.10%
National Grid (NG.) 822.00p 0.92%
TUI AG Reg Shs (DI) (TUI) 805.60p 0.83%
Fresnillo (FRES) 732.00p 0.77%
Severn Trent (SVT) 1,920.00p 0.76%
BAE Systems (BA.) 467.80p 0.71%
United Utilities Group (UU.) 780.80p 0.49%
Royal Dutch Shell 'A' (RDSA) 2,530.00p 0.34%

FTSE 100 - Fallers

Just Eat (JE.) 618.20p -8.79%
Antofagasta (ANTO) 821.40p -1.86%
Sage Group (SGE) 724.60p -1.82%
Glencore (GLEN) 275.45p -1.68%
Smurfit Kappa Group (SKG) 2,183.00p -1.67%
Schroders (SDR) 3,065.00p -1.61%
Informa (INF) 773.80p -1.55%
Ocado Group (OCDO) 1,247.50p -1.38%
Evraz (EVR) 573.80p -1.34%
Melrose Industries (MRO) 178.65p -1.30%

FTSE 250 - Risers

Metro Bank (MTRO) 624.80p 16.46%
Bakkavor Group (BAKK) 128.80p 3.37%
Clarkson (CKN) 2,265.00p 2.95%
Restaurant Group (RTN) 133.05p 2.50%
McCarthy & Stone (MCS) 135.00p 2.20%
TI Fluid Systems (TIFS) 193.94p 2.18%
Syncona Limited NPV (SYNC) 256.26p 2.10%
Mitchells & Butlers (MAB) 250.00p 2.04%
Euromoney Institutional Investor (ERM) 1,386.00p 1.91%
AJ Bell (AJB) 439.35p 1.70%

FTSE 250 - Fallers

Indivior (INDV) 50.22p -5.35%
Cairn Energy (CNE) 164.20p -2.32%
Kier Group (KIE) 327.00p -2.15%
Fidelity China Special Situations (FCSS) 221.95p -1.79%
Hilton Food Group (HFG) 1,011.95p -1.75%
Kaz Minerals (KAZ) 557.80p -1.59%
Aston Martin Lagonda Global Holdings (AML) 861.50p -1.54%
Investec (INVP) 498.90p -1.52%
Greggs (GRG) 2,028.00p -1.46%
Woodford Patient Capital Trust (WPCT) 80.24p -1.42%