London midday: Stocks in the red as traders digest GDP
London stocks had fallen further into the red by midday on Wednesday as investors mulled the latest UK GDP figures.
The FTSE 100 was down 0.5% at 7,049.90.
Neil Wilson, chief market analyst at Markets.com, said: "A tentatively positive start to the session in Europe turned negative within the first hour of the session, reflecting continued uncertainty about lots of things, not least a degree of caution on the last day of the quarter; whilst over the pond US markets ground out fresh record highs as big tech holds the show on the road. Asian shares rose and global stocks were close to record highs, whilst US futures were indicating another higher open. You get the impression that markets want to get the quarter-end out of the way before we see some real movement, but the bias remains mainly positive.
"The FTSE 100 is heading into the final day of trading for the quarter +5.4%, and up 9.5% for the year so far, and is just about holding gains for the month of June despite a soft week. The FTSE 100 still has a long way to go before it recaptures its pre-pandemic highs but should have more room to run."
Data released earlier by the Office for National Statistics showed the economy contracted a touch more than initially estimated in the first quarter as households saved more during the third national lockdown.
Gross domestic product fell 1.6% between January and March, compared to an initial estimate of a 1.5% decline. That leaves 8.8% below pre-pandemic levels, revised from a first estimate of 8.7%.
The household saving ratio rose to 19.9% in the first quarter of 2021 from 16.1% in the fourth quarter of 2020, hitting its second-highest level on record after a 25.9% surge in the second quarter of last year.
Paul Dales, chief UK economist at Capital Economics said: "The small downward revision to Q1 GDP growth probably won’t stop the economy from rising back to its pre-pandemic peak in the coming months. And the larger rebound in the household saving rate increases the potential for faster rises in GDP further ahead."
In equity markets, travel stocks were under the cosh yet again amid worries about restrictions and the impact of the Delta variant. British Airways and Iberia parent IAG, engine maker Rolls-Royce, InterContinental Hotels and Premier Inn owner Whitbread were all weaker. On the FTSE 250, cruise operator Carnival, travel company Tui, budget airline easyJet and WH Smith also fell. Cineworld was also in the red.
On the upside, Dixons Carphone rose after it reinstated its dividend as it swung back to profit on the back of a massive boost in online sales of electrical goods during Covid lockdowns.
Opioid addiction treatment maker Indivior surged after it lifted its 2021 guidance following a better-than-expected business performance through the first half the year.
In broker note action, Workspace was boosted by an upgrade to ‘outperform’ at RBC, while Cairn Energy was knocked lower by a downgrade to ‘hold’ at Berenberg.
Market Movers
FTSE 100 (UKX) 7,049.90 -0.53%
FTSE 250 (MCX) 22,459.08 -0.37%
techMARK (TASX) 4,456.22 -0.05%
FTSE 100 - Risers
Smith & Nephew (SN.) 1,580.50p 1.41%
Sainsbury (J) (SBRY) 270.50p 0.63%
Croda International (CRDA) 7,388.00p 0.63%
Coca-Cola HBC AG (CDI) (CCH) 2,654.00p 0.53%
Whitbread (WTB) 3,131.00p 0.42%
Next (NXT) 7,854.00p 0.41%
Vodafone Group (VOD) 121.50p 0.33%
AstraZeneca (AZN) 8,695.00p 0.24%
Antofagasta (ANTO) 1,452.00p 0.24%
Diageo (DGE) 3,491.50p 0.23%
FTSE 100 - Fallers
Ocado Group (OCDO) 2,010.00p -2.52%
Prudential (PRU) 1,395.50p -2.07%
Taylor Wimpey (TW.) 158.90p -2.06%
London Stock Exchange Group (LSEG) 8,002.00p -2.03%
Entain (ENT) 1,745.00p -1.97%
Fresnillo (FRES) 773.20p -1.68%
Rightmove (RMV) 649.40p -1.61%
Just Eat Takeaway.Com N.V. (CDI) (JET) 6,768.00p -1.56%
Berkeley Group Holdings (The) (BKG) 4,611.00p -1.54%
Barclays (BARC) 170.56p -1.52%
FTSE 250 - Risers
Indivior (INDV) 154.50p 6.33%
Dixons Carphone (DC.) 129.00p 4.96%
Wood Group (John) (WG.) 220.40p 2.51%
Telecom Plus (TEP) 1,184.00p 2.07%
QinetiQ Group (QQ.) 341.00p 1.91%
AO World (AO.) 258.80p 1.73%
Trainline (TRN) 289.80p 1.68%
Bytes Technology Group (BYIT) 464.40p 1.40%
Allianz Technology Trust (ATT) 295.00p 1.37%
Domino's Pizza Group (DOM) 393.80p 1.34%
FTSE 250 - Fallers
Plus500 Ltd (DI) (PLUS) 1,326.00p -3.42%
Cineworld Group (CINE) 78.50p -3.37%
Cairn Energy (CNE) 146.70p -3.23%
IWG (IWG) 298.40p -3.02%
WH Smith (SMWH) 1,574.00p -2.69%
International Public Partnerships Ltd. (INPP) 167.40p -2.67%
Crest Nicholson Holdings (CRST) 427.00p -2.64%
SSP Group (SSPG) 264.60p -2.58%
Renishaw (RSW) 4,976.00p -2.34%
Ashmore Group (ASHM) 376.80p -2.23%