London midday: Stocks fall further as Lloyds results disappoint
London stocks were firmly in the red by midday on Thursday following disappointing results from the likes of Lloyds.
The FTSE 100 was down 1.6% at 6,031.34, extending earlier losses, with the latest economic growth figures out of Germany denting sentiment.
According to Destatis, GDP fell by a record 10.1% quarter-on-quarter in the second quarter as the Covid-19 crisis took its toll. This marked the biggest decline since records began in 1970. It was steeper than the 9% drop expected by economics and much worse than the 4.7% contraction seen in the first quarter of 2009 during the financial crisis.
IG analyst Chris Beauchamp said: "A double-digit percentage decline in the German economy and abysmal results from Lloyds have put the cat among the pigeons.
"Continuing indications of a rise in virus cases throughout Europe have added to the caution, with markets worrying that Q2 was not the last quarter of significant economic weakness.
"The FTSE 100, the serial underperformer of the past four months, is now heading back towards 6,000, having seen upward momentum stall over the past two months around the 6,300 mark."
Investors were wading through a deluge of results.
Lloyds Bank was under the cosh after it set aside a further £2.4bn for bad debts in the second quarter as it swung to a heavy first-half loss and braced for a "significant deterioration" in the economic outlook amid the coronavirus pandemic.
Standard Chartered was also in the red as it increased its bad loans provision to almost $1.6bn in the first half . The bank reported credit impairments of $611m in the second quarter, up from $176m a year ago and in addition to $956m reported in the first quarter.
Royal Dutch Shell was weaker after swinging to a heavy net first-half loss, but paying a dividend as Covid-19 hammered oil and gas prices.
Technology-led services and payments specialist Equiniti tumbled after saying it swung to a first-half pre-tax loss as its business took a hit from the pandemic.
Car dealership Inchcape was under pressure after saying it would be cutting jobs globally as it swung to a first-half loss due to coronavirus shutdowns.
On the upside, BAE Systems was the standout gainer on the FTSE 100 after the arms maker said full-year profits would be lower due to the pandemic, but that it expected a good second half as it reinstated dividend payments.
Pharmaceuticals giant AstraZeneca was on the rise after its first-half numbers beat analysts’ expectations.
Pest control and hygiene services company Rentokil gained even as it said first-half adjusted pre-tax profit fell 11% as the temporary closure of some businesses due to lockdowns took its toll on the business.
FTSE 100 - Risers
BAE Systems (BA.) 491.20p 3.00%
AstraZeneca (AZN) 8,843.00p 2.65%
Rentokil Initial (RTO) 555.00p 1.20%
Whitbread (WTB) 2,297.00p 1.06%
Schroders (SDR) 2,990.00p 0.74%
Hikma Pharmaceuticals (HIK) 2,141.00p 0.61%
3i Group (III) 887.00p 0.32%
SEGRO (SGRO) 951.60p -0.08%
Pearson (PSON) 538.80p -0.15%
Croda International (CRDA) 5,770.00p -0.59%
FTSE 100 - Fallers
Lloyds Banking Group (LLOY) 26.23p -7.53%
GVC Holdings (GVC) 670.00p -6.16%
Legal & General Group (LGEN) 211.40p -6.00%
NATWEST GROUP PLC ORD 100P (NWG) 105.45p -5.43%
Prudential (PRU) 1,113.50p -4.67%
M&G (MNG) 155.95p -4.38%
St James's Place (STJ) 931.80p -4.37%
Smith & Nephew (SN.) 1,551.50p -4.20%
Standard Chartered (STAN) 402.80p -4.16%
Rolls-Royce Holdings (RR.) 242.80p -4.07%
FTSE 250 - Risers
Ultra Electronics Holdings (ULE) 2,366.00p 8.14%
Vesuvius (VSVS) 406.80p 7.17%
Hastings Group Holdings (HSTG) 210.80p 5.08%
Signature Aviation (SIG) 238.10p 3.48%
PayPoint (PAY) 614.00p 3.02%
Pets at Home Group (PETS) 258.60p 2.86%
Weir Group (WEIR) 1,232.00p 2.67%
FirstGroup (FGP) 34.00p 2.66%
PPHE Hotel Group Ltd (PPH) 1,090.00p 2.35%
Workspace Group (WKP) 591.50p 1.98%
FTSE 250 - Fallers
Equiniti Group (EQN) 109.80p -23.32%
Inchcape (INCH) 434.00p -10.33%
Just Group (JUST) 44.44p -5.97%
Wizz Air Holdings (WIZZ) 3,346.00p -4.67%
Virgin Money UK (VMUK) 94.22p -4.42%
TUI AG Reg Shs (DI) (TUI) 309.70p -4.30%
Greggs (GRG) 1,270.00p -4.22%
Aston Martin Lagonda Global Holdings (AML) 53.75p -4.02%
Cineworld Group (CINE) 39.39p -4.00%
Airtel Africa (AAF) 53.10p -3.98%