London close: Stocks move lower even as Sterling slips
By Digital Look
Date: Tuesday 17 Oct 2017
(ShareCast News) - London stocks closed lower on Tuesday even as the pound fell back against the dollar, albeit following a brief pop higher after data showed inflation surged to a five-year high last month, amid somewhat dovish remarks from Bank of England policymakers.
The FTSE 100 was down 0.14% to 7,516.17, while the pound was 0.15% lower against the euro at 1.1216 and down 0.54% versus the dollar at 1.3177.
Over on the second-tier index, losses were even steeper at -0.43% to 20,130.95.
European stocks also drifted lower on Tuesday with the DAX off by 0.07% to 12,995.06, the CAC 40 0.16% down 0.03% at 5,361.37 and the IBEX 35 0.35% firmer at 10,216.80.
Figures released by the Office for National Statistics showed annual UK consumer prices inflation rose to 3% in September, in line with economists' forecasts after hitting 2.9% the month before.
CPI was up 0.3% month-on-month, also as expected, following 0.6% a month earlier.
Core CPI, which excludes more volatile prices such as energy and food, remained at 2.7%, as forecast.
IG analyst Chris Beauchamp said: "Given the robust expectation that November will see the Bank of England dust off its 'rate increase' button, the in-line reading for annual CPI was not enough to send the pound much higher."
Investors were also digesting comments from BoE governor Mark Carney and colleagues in testimony to the Treasury Select Committee.
The Canadian said that inflation is set to peak just above 3% in the next few weeks and that although this should pass through an interest rate hike "in the coming months may be appropriate".
However, his two new deputies on the Monetary Policy Committee cast some doubt on the likelihood of an increase in interest rates in November.
Sir Dave Ramsden, a July appointment to the MPC, said he was not part of the majority of policymakers who believed a rate hike is likely to be needed in the coming months due to his impression that inflation pressures will begin to ease.
Silvana Tenreyro, who was appointed in June, said: "My view is that we are approaching a tipping pint at which it would be necessary or justified to remove some of that stimulus. However that is very contingent on the data."
A key item of data will be the average wage growth numbers released on Wednesday.
In corporate news, Pearson surged after saying it generated revenues in the first nine months of the year in line with expectations and it was on track to deliver in the upper half of management's guided range, with the educational publisher also fine-tuning its earnings guidance and promising a £300m share buyback.
Sainsbury's and Morrisons were on the leaderboard despite mixed sales data from Kantar Worldpanel and Nielsen, while Tesco was flat.
Theme park operator Merlin Entertainments tanked after it reported comparable revenue was broadly flat as London sites were hit by bad weather and the impact of terror attacks.
Rio Tinto were flat after cutting its copper guidance for the year as it reported a drop in mined copper in the third quarter.
Moneysupermarket.com ticked lower after it posted a rise in third-quarter revenue overall, but revealed a drop in revenue from the money and home services divisions, while Mediclinic slumped after its half-year trading statement.
Smiths Group slipped as it appointed John Shipsey as chief financial officer designate with effect from Wednesday.
Housebuilder Bellway was on the front foot after it reported a jump in full-year profit and revenue as demand for new housing remained strong, while challenger bank Virgin Money rallied after its third-quarter update came in as expected.
AstraZeneca was a touch firmer after saying that the US regulator has accepted a supplemental biologics license application for its Imfinzi drug, granting it priority review status.
Market Movers
FTSE 100 (UKX) 7,516.17 -0.14%
FTSE 250 (MCX) 20,130.95 -0.43%
techMARK (TASX) 3,547.46 -0.19%
FTSE 100 - Risers
Pearson (PSON) 667.00p 7.32%
Convatec Group (CTEC) 213.00p 3.90%
International Consolidated Airlines Group SA (CDI) (IAG) 635.50p 2.67%
easyJet (EZJ) 1,316.00p 2.17%
Severn Trent (SVT) 2,122.00p 1.92%
WPP (WPP) 1,401.00p 1.74%
Sainsbury (J) (SBRY) 247.70p 1.68%
United Utilities Group (UU.) 842.00p 1.32%
Lloyds Banking Group (LLOY) 66.33p 1.13%
Barclays (BARC) 191.35p 1.11%
FTSE 100 - Fallers
Merlin Entertainments (MERL) 378.00p -15.94%
Mediclinic International (MDC) 645.50p -4.37%
Standard Life Aberdeen (SLA) 429.00p -3.88%
3i Group (III) 940.00p -2.89%
St James's Place (STJ) 1,157.00p -2.20%
Johnson Matthey (JMAT) 3,374.00p -2.17%
Randgold Resources Ltd. (RRS) 7,320.00p -2.14%
Antofagasta (ANTO) 1,015.00p -2.13%
Shire Plc (SHP) 3,839.00p -2.08%
NMC Health (NMC) 2,843.00p -1.83%
FTSE 250 - Risers
Virgin Money Holdings (UK) (VM.) 301.30p 4.36%
Workspace Group (WKP) 927.50p 3.39%
BTG (BTG) 727.00p 2.83%
Greencore Group (GNC) 190.50p 2.31%
Hikma Pharmaceuticals (HIK) 1,182.00p 2.25%
Bellway (BWY) 3,569.00p 1.88%
Aldermore Group (ALD) 308.30p 1.75%
Telecom Plus (TEP) 1,228.00p 1.67%
Supergroup (SGP) 1,842.00p 1.66%
Card Factory (CARD) 322.10p 1.52%
FTSE 250 - Fallers
Hochschild Mining (HOC) 221.40p -6.97%
Sirius Minerals (SXX) 26.35p -4.70%
Vedanta Resources (VED) 883.00p -4.64%
Ferrexpo (FXPO) 275.30p -4.11%
Acacia Mining (ACA) 180.80p -3.47%
Inmarsat (ISAT) 608.00p -2.95%
Brown (N.) Group (BWNG) 308.20p -2.93%
TalkTalk Telecom Group (TALK) 209.00p -2.56%
Kaz Minerals (KAZ) 855.50p -2.28%
CLS Holdings (CLI) 217.70p -2.21%
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