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FTSE 100 movers: Tobacco stocks slide but miners, energy firms gain

By Michele Maatouk

Date: Monday 12 Nov 2018

FTSE 100 movers: Tobacco stocks slide but miners, energy firms gain

(Sharecast News) - London's FTSE 100 was down 0.5% to 7,073.63 in afternoon trade on Monday, with weakness in the tobacco sector offsetting strong energy and mining shares.
British American Tobacco and Imperial Brands suffered heavy losses following reports that the US Food and Drug Administration is looking to ban menthol cigarettes. BAT derives around 20% to 25% of group profits from US menthol.

Nicholas Hyett, equity analyst at Hargreaves Lansdown, said: "Along with cigarette volumes shrinking, regulation is the other inevitable fact of the tobacco industry.

"The acquisition of Reynolds gave BATS a dominant position in US menthol. That's a segment that's been in regulators' sights for some time - thanks to its perceived status as a gateway for new smokers. The FDA are now said to be considering banning them altogether. While many menthol smokers would likely move over to non-menthol products, it would still be a major blow."

On the upside, miners rose, with BHP Billiton, Rio Tinto and Anglo American all higher as copper prices rallied.

Rio was also up after it successfully completed an AUD$2.87bn off-market buyback.

Wood Group pushed higher after being awarded three new call-off contracts totalling $53m by the Abu Dhabi National Oil Company.

Informa gained ground as Kepler Cheuvreux upped is stance on the events and publishing company to 'buy' from 'hold' after an encouraging 10-month trading update, which it said brings into focus the 20% valuation gap versus professional publishing peers for only a marginal difference in organic growth. It highlighted organic growth of 3.5% for Informa versus 4% for Relx and Wolters Kluwer.

BP and Shell gushed higher as oil prices were boosted by news that Saudi Arabia plans to cut production by 500,000 barrels a day next month.

Pharmaceutical giant AstraZeneca was on the front foot after saying that its diabetes drug Farxiga had "significantly" reduced the risk of hospitalisation for heart failure in a clinical trial.

Shire advanced as Japan's Takeda Pharmaceutical said it will seek investor backing for its acquisition next month and aims to close the deal on 8 January.

FTSE 100 - Risers

BHP Billiton (BLT) 1,626.60p 2.59%
Wood Group (John) (WG.) 680.60p 2.35%
Rio Tinto (RIO) 3,939.00p 2.32%
Informa (INF) 726.00p 2.17%
BP (BP.) 534.90p 2.10%
Rolls-Royce Holdings (RR.) 827.60p 1.62%
AstraZeneca (AZN) 6,272.00p 1.62%
Royal Dutch Shell 'B' (RDSB) 2,502.00p 1.60%
Anglo American (AAL) 1,713.80p 1.54%
Shire Plc (SHP) 4,675.50p 1.37%

FTSE 100 - Fallers

British American Tobacco (BATS) 3,014.00p -9.07%
Ocado Group (OCDO) 812.59p -4.69%
Kingfisher (KGF) 244.50p -4.16%
easyJet (EZJ) 1,202.00p -4.15%
Just Eat (JE.) 584.60p -3.69%
Imperial Brands (IMB) 2,659.13p -3.30%
Persimmon (PSN) 2,312.00p -3.10%
GVC Holdings (GVC) 812.50p -3.04%
Taylor Wimpey (TW.) 163.10p -2.92%
Barratt Developments (BDEV) 528.40p -2.87%

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