London open: Stocks nudge lower as Thomas Cook tanks on profit warning
FTSE 100
8,354.05
16:50 08/05/24
London stocks nudged a touch lower in early trade on Tuesday, with Thomas Cook sharply lower after another profit warning and sterling under the cosh.
GBP/USD
$1.2498
05:18 09/05/24
At 0830 GMT, the FTSE 100 was down 0.1% to 7,032.51, while the pound was 0.7% weaker against the dollar at 1.2735 and 0.4% lower versus the euro at 1.1267 amid concerns about how Theresa May will get her Brexit deal through Parliament and after Donald Trump cautioned that the US could stop trading with the UK.
Trump said the latest Brexit deal announced by Theresa May was a "great deal for the EU" but could mean that the US stops trading with the UK.
In a speech outside the White House on Monday, the US President said: "I think we have to take a look at, seriously, whether or not the UK is allowed to trade. Because, you know, right now, if you look at the deal, they may not be able to trade with us."
However, a Downing Street spokesperson later refuted the claims.
"The stakes are high for Theresa May as she's embarking on a journey to secure the necessary support to get her Brexit deal through the Parliament," said Konstantinos Anthis, head of research at ADSS. "In the short term, cable is pointing lower as the odds of May getting the votes she needs are slim: the interim support lies at 1.2760 and a slide below that clears the path towards the 1.27 round figure."
Meanwhile, Sino-US relations were in focus again after Trump renewed his China tariff threats ahead of the G20 meeting at the end of the week, though China's foreign ministry spokesman told reporters that on a phone call earlier this month Trump and president Xi Jinping had agreed to reach a "mutually beneficial" arrangement on trade.
In corporate news, shares in FTSE 250 tour operator Thomas Cook were in freefall after it withdrew its dividend and cut its annual profits guidance for the third time this year. The company, having only just issued a second profit warning in September, said its final result was expected to be around £30m lower than previously guided due to a number of legacy and non-recurring charges.
FTSE 100 peer TUI was also on the back foot.
"The woe continues for shareholders, in what has been an awful year for Thomas Cook," said CMC Markets analyst Michael Hewson. "Before this morning’s announcement, the share price had already fallen 60% year to date and this announcement along with the news that the company was suspending the dividend has seen the shares plunge another 30%.
"The decision to cut the dividend can’t have been taken lightly, however the lack of dividend is likely to be the least of shareholders' problems given how badly the shares have performed this year."
Elsewhere, NMC Health was down nearly 8% after Jefferies downgraded the stock to 'underperform' from 'hold'.
Amigo Holdings slipped even as the high interest lender reported a rise in revenue and profit in its first interim results since its IPO in July as customer numbers grew.
Rathbone Brothers was in the red as it announced the departure of chief executive officer Philip Howell and said it has appointed Paul Stockton as his successor.
On the upside, bakery chain Greggs surged as it said total sales in the eight weeks to 24 November were up 9% and lifted its 2018 profit forecast.
Pennon gained as the utility posted a 2.9% rise in first-half pre-tax profit and a 3.1% increase in revenue and Hikma Pharmaceuticals was boosted by an upgrade to 'buy' from 'hold' at Jefferies.
Market Movers
FTSE 100 (UKX) 7,032.51 -0.05%
FTSE 250 (MCX) 18,669.06 -0.27%
techMARK (TASX) 3,450.39 -0.26%
FTSE 100 - Risers
Coca-Cola HBC AG (CDI) (CCH) 2,319.00p 2.20%
Unilever (ULVR) 4,267.00p 1.63%
Reckitt Benckiser Group (RB.) 6,757.00p 1.21%
Diageo (DGE) 2,845.25p 1.13%
British American Tobacco (BATS) 2,746.00p 1.07%
National Grid (NG.) 834.86p 1.04%
Centrica (CNA) 134.15p 1.02%
Royal Mail (RMG) 335.10p 0.66%
BT Group (BT.A) 261.55p 0.60%
SSE (SSE) 1,125.50p 0.49%
FTSE 100 - Fallers
NMC Health (NMC) 3,318.00p -7.83%
TUI AG Reg Shs (DI) (TUI) 1,197.00p -4.24%
Antofagasta (ANTO) 788.80p -2.11%
Barclays (BARC) 165.98p -1.61%
International Consolidated Airlines Group SA (CDI) (IAG) 651.60p -1.24%
Royal Bank of Scotland Group (RBS) 222.70p -1.15%
Barratt Developments (BDEV) 502.60p -1.06%
easyJet (EZJ) 1,225.00p -1.05%
ITV (ITV) 151.80p -1.04%
Johnson Matthey (JMAT) 3,047.00p -0.97%
FTSE 250 - Risers
Greggs (GRG) 1,386.00p 12.05%
Hikma Pharmaceuticals (HIK) 1,780.50p 4.00%
Wetherspoon (J.D.) (JDW) 1,191.00p 2.85%
TI Fluid Systems (TIFS) 198.30p 1.95%
NewRiver REIT (NRR) 231.50p 1.54%
Pennon Group (PNN) 767.60p 1.48%
TalkTalk Telecom Group (TALK) 122.70p 1.32%
IWG (IWG) 239.96p 1.04%
Fidelity China Special Situations (FCSS) 195.60p 1.03%
Sirius Minerals (SXX) 23.12p 0.96%
FTSE 250 - Fallers
Thomas Cook Group (TCG) 34.44p -29.05%
Premier Oil (PMO) 68.94p -4.38%
Cranswick (CWK) 2,750.00p -4.25%
UDG Healthcare Public Limited Company (UDG) 595.00p -4.11%
Metro Bank (MTRO) 2,104.00p -3.49%
Convatec Group (CTEC) 156.35p -3.40%
CYBG (CYBG) 207.20p -2.72%
Marshalls (MSLH) 429.60p -2.36%
IMI (IMI) 953.00p -2.26%
Sanne Group (SNN) 592.00p -2.15%