London open: Super Thursday kicks off on back foot but Compass bucks trend

London stocks fell in early trade on Thursday, taking their cue from a negative close on Wall Street as investors eyed the latest minutes, rate announcement and quarterly Inflation Report from the Bank of England at midday.

AT 0830 GMT, the FTSE 100 was down 0.4% to 7,248.41, while the pound was up 0.1% against the euro at 1.1324 and 0.2% weaker versus the dollar at 1.3858.

Neil Wilson, senior market analyst at ETX Capital, said: "The BoE is not about to change rates and a 9-0 vote of the MPC in favour of the status quo is expected, although perennial hawks McCafferty and Saunders arguably might go for an early hike. There is also a low chance that the BoE will significantly alter its GDP or CPI projections.

"Nevertheless, it may well sound more upbeat on the economy and Brexit. The market may also discern some hawkishness if the report moves away from stressing downside risks to the economy. At present the market is pricing for a hike later in the year but this outlook could be a little too pessimistic and some think that this meeting, while offering no material change, could just move the needle a little bit forwards. The market is giving the Bank an evens chance of hiking in May - unless it’s incredibly bland and noncommittal, this week’s meeting ought to offer more clarity about whether the MPC will go in May or will wait until later in the year. No change is expected but this one could soften up the market for a hike in May.”

Investors and homeowners were also digesting the latest survey from the Royal Institution of Chartered Surveyors, which showed that the balance of surveyors reporting that house prices have risen over the last three months held steady at +8% in December, slightly above consensus expectations for a drop to +5%.

Meanwhile, the new buyer enquiries balance rose to -11% from -15% but remained in negative territory for the tenth consecutive month.

On the corporate front, Sophos shares tumbled as the network security solutions provider reported a 19.6% drop in adjusted operating profit for the third quarter.

TalkTalk tanked after saying it was looking to raise £200m in a placing to bolster its balance sheet and warning that full-year earnings before interest, tax, depreciation and amortisation would come in below the guidance given in November.

Thomas Cook was in the red after it said it remained on track to meet full-year forecasts but warned that the market remains highly competitive.

Qinetiq fell after saying it traded as expected in the third quarter and maintaining its expectations for its overall performance in 2018, while Tate & Lyle lost ground despite saying that it is on track to deliver full-year adjusted pre-tax profit in line with guidance at constant currency.

Ashmore was weaker as it posted a drop in half-year profit but a rise in assets under management.

On the upside, Compass was the standout gainer after it served up a first quarter update showing improved revenue growth even though the catering group said UK cost pressures were "above average".

Smith & Nephew edged higher after it reported a 17% rise in annual profit as the medical products company sold more knee implants and grew strongly in emerging markets.

Roadside assistance and insurance group AA surged after saying full-year trading EBITDA is expected to come in at £390m to £395m, in line with the guidance provided in September, while Beazley racked up solid gains after its full-year pre-tax profit beat analysts' expectations.

GlaxoSmithKline advanced as ViiV Healthcare, the global specialist HIV company majority-owned by the group with Pfizer and Shionogi as shareholders, said it has filed patent infringement litigation against Gilead Sciences over bictegravir in the US and Canada.

Bellway nudged up after saying that housing revenue for the six months to the end of January 2018 is expected to rise to around £1.3bn from £1.1bn in the same period a year ago amid strong demand.

Market Movers

FTSE 100 (UKX) 7,248.41 -0.43%
FTSE 250 (MCX) 19,658.52 -0.17%
techMARK (TASX) 3,288.86 -0.09%

FTSE 100 - Risers

Compass Group (CPG) 1,515.50p 5.46%
WPP (WPP) 1,300.00p 3.05%
RSA Insurance Group (RSA) 613.60p 1.72%
GlaxoSmithKline (GSK) 1,300.20p 1.15%
Direct Line Insurance Group (DLG) 375.20p 0.97%
ITV (ITV) 169.00p 0.93%
GKN (GKN) 414.10p 0.58%
AstraZeneca (AZN) 4,816.00p 0.55%
Admiral Group (ADM) 1,854.00p 0.54%
Smurfit Kappa Group (SKG) 2,456.00p 0.49%

FTSE 100 - Fallers

Sage Group (SGE) 697.40p -2.32%
BHP Billiton (BLT) 1,484.20p -1.85%
BT Group (BT.A) 237.10p -1.74%
easyJet (EZJ) 1,639.50p -1.62%
Fresnillo (FRES) 1,230.00p -1.56%
Rio Tinto (RIO) 3,820.00p -1.56%
Scottish Mortgage Inv Trust (SMT) 443.31p -1.49%
Randgold Resources Ltd. (RRS) 6,122.00p -1.48%
Evraz (EVR) 349.70p -1.47%
British American Tobacco (BATS) 4,581.00p -1.38%

FTSE 250 - Risers

AA (AA.) 144.11p 8.07%
Beazley (BEZ) 561.00p 5.55%
TBC Bank Group (TBCG) 1,630.00p 3.30%
Lancashire Holdings Limited (LRE) 668.00p 2.85%
Vectura Group (VEC) 82.95p 2.79%
Dignity (DTY) 765.50p 2.27%
Saga (SAGA) 119.00p 2.15%
William Hill (WMH) 316.00p 2.03%
McCarthy & Stone (MCS) 150.40p 1.83%
Balfour Beatty (BBY) 273.80p 1.56%

FTSE 250 - Fallers

TalkTalk Telecom Group (TALK) 103.50p -13.53%
Sophos Group (SOPH) 544.50p -12.39%
Capital & Counties Properties (CAPC) 273.40p -2.15%
RDI Reit (RDI) 34.50p -2.13%
Tate & Lyle (TATE) 640.00p -2.05%
Aberforth Smaller Companies Trust (ASL) 1,251.88p -2.04%
Hill & Smith Holdings (HILS) 1,162.00p -1.94%
Hochschild Mining (HOC) 211.10p -1.72%
Petrofac Ltd. (PFC) 448.40p -1.65%
Convatec Group (CTEC) 199.00p -1.49%