FTSE 100 movers: Taylor Wimpey drops on update; paper companies rally

London's FTSE 100 was down 0.6% at 7,425.37 in afternoon trade on Thursday.

Legal & General and Antofagasta were in the red as their stock went ex-dividend.

Taylor Wimpey was under the cosh after the housebuilder hailed a "good" start to the year despite wider macroeconomic uncertainty but said margins will be slightly lower this year due to greater build cost inflation.

Russ Mould, investment director at AJ Bell, said the step-up in the level of cost inflation, which has been steady for the last few years at between 3% and 4%, is "troubling".

"This spells danger for the company’s level of profitability, particularly when you consider that asking prices are flat quarter-on-quarter," he said.

Sainsbury's retreated after the Competition and Markets Authority blocked its proposed merger with Asda on the grounds that it would leave shoppers worse off.

Barclays was lower after it posted a 10% drop in first-quarter profit as total income also fell amid tougher times for its corporate and investment bank division, and said it might have to cut costs further to meet returns targets.

RBS fell as chief executive Ross McEwan resigned after five and a half years in the role and ahead of its first-quarter numbers on Friday.

British American Tobacco and Imperial Brands both lost ground as shares in US tobacco maker Altria fell after its first-quarter numbers missed analysts' expectations on the top and bottom lines.

On the upside, paper and packaging groups DS Smith and Mondi were trading higher after well-received results from US peer International Paper, whose first-quarter profit beat expectations.

Education publisher Pearson was on the front foot ahead of its first-quarter trading update on Friday.

FTSE 100 - Risers

Smith (DS) (SMDS) 364.10p 1.20%
Mondi (MNDI) 1,714.00p 1.15%
London Stock Exchange Group (LSE) 5,038.00p 1.06%
Reckitt Benckiser Group (RB.) 6,101.00p 0.99%
St James's Place (STJ) 1,136.00p 0.89%
Kingfisher (KGF) 264.80p 0.84%
Carnival (CCL) 4,032.00p 0.80%
Ferguson (FERG) 5,450.00p 0.74%
Pearson (PSON) 871.80p 0.72%
NMC Health (NMC) 2,702.00p 0.67%

FTSE 100 - Fallers

Legal & General Group (LGEN) 274.40p -5.22%
Taylor Wimpey (TW.) 183.65p -4.47%
Sainsbury (J) (SBRY) 216.50p -4.46%
Barclays (BARC) 160.02p -3.82%
Glencore (GLEN) 322.10p -3.58%
British American Tobacco (BATS) 2,941.44p -3.37%
Antofagasta (ANTO) 928.60p -3.09%
Imperial Brands (IMB) 2,376.71p -2.91%
Royal Bank of Scotland Group (RBS) 249.70p -2.73%
Micro Focus International (MCRO) 1,930.00p -2.67%