London close: Markets finish in the red as Boris takes the reins
London stocks had pared back some of their earlier losses by the close on Wednesday, but still finished in the red, with market sentiment weighed down by weakness in the mining sector.
The FTSE 100 ended the day down 0.73% at 7,501.46, while sterling was up 0.45% against the dollar at $1.2496 and 0.54% firmer versus the euro at €1.1214, as Boris Johnson prepared to enter 10 Downing Street.
“Plus ca change - a new prime minister, the same problems,” quipped Neil Wilson, chief market analyst at Markets.com earlier.
“Key questions remain over whom he appoints to cabinet and what tack he’ll take with the EU over the coming days.
“A lot of the Boris factor is priced in - what's not is an actual no-deal. If Boris does well in selling a newish deal - lipstick on the pig if you like - then the pound can rally hard from here.”
More broadly, there were some signs of progress in Sino-US trade talks as Bloomberg reported that US trade representative Robert Lighthizer and senior US officials were set to travel to China next Monday for the first high-level, face-to-face negotiations between the two nations.
In equity markets, miners were in the red, with Rio Tinto, Anglo American and BHP all lower, tracking a fall in iron ore prices as Brazil's Vale was set to resume operations at its Vargem Grande complex.
Rio Tinto finished down 4.6%, Anglo American was off 3.25%, and BHP ended the session in the red by 4%.
“The news has seen iron ore prices fall, putting pressure on mining stocks on fears that the strong rally in iron ore will now start to reverse, as more producers look to take advantage of the high prices,” said Chris Beauchamp, chief market analyst at IG.
The sector was also hit after broker Liberum downgraded its stance on the London-listed trio.
Speciality chemicals company Croda International was among the leading losers, falling 3.4% after it posted a drop in first-half pre-tax profit, as its personal care business in the US and North Asia took a hit from the Sino-US trade spat.
Aston Martin Lagonda plunged 25.91%, after the luxury car maker cut its sales and profit forecasts for this year, highlighting macroeconomic uncertainty and weakness in UK and European markets.
Marston's lost its fizz, sliding 11.99% as the brewer reported a "modest" 0.5% increase in like-for-like sales at its managed and franchised pubs for the 42 weeks to 20 July.
The company noted poor weather in May and June, and said it had decided to accelerate plans to cut debt and generate cash by deferring its remaining new-build plans and reallocate between £20m and £30m of £70m in new-build capital expenditure in a bid to “drive higher returns from our existing estate”.
Tullow Oil slipped 0.43% after it revised its 2019 full-year production forecast downwards to between 89,000 and 93,000 barrels of oil per day, as a result of mechanical issues it faced in the completion of the Enyenra-14 production well in Ghana.
On the upside, ITV rallied 6.59% as the broadcaster said profits and revenue dropped in the first half of this year, but a 5% decline in advertising revenue was better than it had previously guided, thanks in part to solid viewing figures for its ‘Love Island’ reality television series.
Exhibitions, events and information services group Informa was 6.52% higher after it posted a jump in first-half profit and revenue and said it was "performing to plan" across the business.
Sports Direct International surged 11.47% after the retailer said that its delayed audited results would now be out on 26 July, and confirmed they would be in line with the guidance it gave back in December.
“This is a relief to investors no doubt but shares remain at year-to-date lows so there is an implication that they’re still unsure about the strategy and cost of acquisitions,” Neil Wilson said.
“On that note, the guidance around House of Fraser suggests that it still is leaking cash and we will be waiting for what the next steps are for this brand.”
Market Movers
FTSE 100 (UKX) 7,501.46 -0.73%
FTSE 250 (MCX) 19,787.78 0.18%
techMARK (TASX) 3,710.84 0.35%
FTSE 100 - Risers
ITV (ITV) 113.25p 6.59%
Informa (INF) 881.00p 6.53%
Taylor Wimpey (TW.) 173.50p 3.86%
Next (NXT) 5,658.00p 3.59%
SEGRO (SGRO) 776.80p 3.00%
Marks & Spencer Group (MKS) 211.70p 2.47%
NMC Health (NMC) 2,479.00p 2.44%
Persimmon (PSN) 2,065.00p 1.92%
Berkeley Group Holdings (The) (BKG) 3,855.00p 1.90%
Associated British Foods (ABF) 2,393.00p 1.83%
FTSE 100 - Fallers
Rio Tinto (RIO) 4,606.50p -4.60%
Standard Chartered (STAN) 683.40p -4.51%
BHP Group (BHP) 1,960.80p -4.00%
Croda International (CRDA) 4,662.00p -3.40%
Anglo American (AAL) 2,187.00p -3.25%
Evraz (EVR) 653.60p -2.68%
Burberry Group (BRBY) 2,251.00p -2.22%
HSBC Holdings (HSBA) 656.40p -2.16%
Whitbread (WTB) 4,460.00p -1.83%
AstraZeneca (AZN) 6,359.00p -1.62%
FTSE 250 - Risers
Sports Direct International (SPD) 254.60p 11.47%
Drax Group (DRX) 303.60p 5.86%
B&M European Value Retail S.A. (DI) (BME) 375.30p 5.10%
IP Group (IPO) 70.60p 4.75%
Cranswick (CWK) 2,580.00p 3.70%
Dunelm Group (DNLM) 934.00p 3.20%
Ultra Electronics Holdings (ULE) 1,872.00p 2.97%
QinetiQ Group (QQ.) 285.40p 2.96%
Redrow (RDW) 569.00p 2.71%
Bellway (BWY) 2,985.00p 2.61%
FTSE 250 - Fallers
Aston Martin Lagonda Global Holdings (AML) 766.80p -25.91%
Marston's (MARS) 107.20p -11.99%
TBC Bank Group (TBCG) 1,314.00p -11.81%
Sirius Minerals (SXX) 15.03p -5.83%
Metro Bank (MTRO) 476.40p -4.22%
Intu Properties (INTU) 78.50p -4.01%
Pagegroup (PAGE) 440.80p -3.88%
FDM Group (Holdings) (FDM) 844.00p -3.02%
Ascential (ASCL) 378.80p -2.87%
Bank of Georgia Group (BGEO) 1,516.00p -2.76%