FTSE 100 movers: Ocado rallies on contract win; Carnival sinks
London' s FTSE 100 was up 0.4% at 7,207.49 in afternoon trade on Tuesday, with Ocado pacing the gains.
Ocado was the standout gainer as it won a contract to develop an online grocery business for Australian supermarket and liquor store operator Coles Group.
Coles, which will pay Ocado up-front fees upon signing and during the development phase, and Ocado have agreed to build and operate a robot-run depot in Sydney and one in Melbourne, both expected to go live by March 2023.
From that stage, Coles will pay ongoing fees linked to both sales achieved and installed capacity.
On the downside, Carnival shares sank as the cruise line operator cut its guidance for full-year earnings per share, blaming higher fuel costs and headwinds in currency markets for the shortfall. Company boss Arnold Donald said Carnival remained on course to deliver double-digit earnings growth and a higher return on invested capital "over time" and that earnings per share were still rising from the prior year level.
Plumbing and heating products distributor Ferguson was under pressure as it said trading profit for the full year will be towards the lower end of analysts' expectations. Equipment rental firm Ashtead, which like Ferguson has a large presence in the US, also fell.
Russ Mould, investment director at AJ Bell, said Ferguson's warning about a slowdown in second-half sales growth raises questions about the economic health of its largest market, the USA.
"For the first half, it looks like the villain of the piece was the UK, where sales fell again on an underlying basis in the second quarter. However, what has really spooked investors is management’s forecast of sales growth for the year of 3% to 5%. That implies a modest growth in the second half after that 6.5% increase in the first."
Airlines EasyJet and International Consolidated Airlines Group flew lower as oil prices rose, with Brent at its highest level since 12 November.
Rolls Royce slipped as JPMorgan Cazenove cut its price target on the stock to 650p from 700p as it made additional cuts to its earnings per share estimates, citing soft guidance on the company's EBITA margins.
FTSE 100 - Risers
Ocado Group (OCDO) 1,316.00p 4.82%
Hikma Pharmaceuticals (HIK) 1,754.00p 2.78%
Just Eat (JE.) 745.60p 2.70%
Associated British Foods (ABF) 2,373.00p 2.55%
Evraz (EVR) 609.20p 2.42%
Fresnillo (FRES) 869.60p 2.31%
Paddy Power Betfair (PPB) 5,915.00p 1.98%
Hargreaves Lansdown (HL.) 1,803.00p 1.84%
Whitbread (WTB) 5,042.00p 1.71%
Burberry Group (BRBY) 1,874.50p 1.63%
FTSE 100 - Fallers
Carnival (CCL) 3,820.00p -7.97%
easyJet (EZJ) 1,128.00p -2.34%
Tesco (TSCO) 229.02p -1.62%
CRH (CRH) 2,300.00p -1.50%
Smiths Group (SMIN) 1,386.50p -1.11%
International Consolidated Airlines Group SA (CDI) (IAG) 515.80p -1.00%
Barclays (BARC) 154.24p -0.84%
Lloyds Banking Group (LLOY) 61.55p -0.77%
Direct Line Insurance Group (DLG) 352.20p -0.70%
Standard Chartered (STAN) 576.70p -0.69%