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London midday: Stocks in the red as Evergrande woes dent sentiment

By Michele Maatouk

Date: Thursday 21 Oct 2021

London midday: Stocks in the red as Evergrande woes dent sentiment

(Sharecast News) - London stocks were still in the red by midday on Thursday amid concerns about Chinese property group Evergrande, after it failed to complete a $2.6bn asset sale.
The FTSE 100 was down 0.5% at 7,185.43.

AJ Bell financial analyst Danni Hewson said: "The FTSE 100 slipped in early trading on Thursday as China's Evergrande crisis reared its ugly head again.

"The heavily indebted property developer failed to complete a key asset sale to leave it teetering amid fears of wider contagion from a potential collapse of the business.

"This hit stocks with Chinese exposure, most notably the mining sector. China is the world's biggest consumer of many metals and minerals.

"Rising Covid-19 cases in the UK were also affecting sentiment amid fears measures might need to be brought in over the winter to control the spread of the virus."

On the macro front, data released earlier by the Office for National Statistics showed public borrowing fell by almost half in the first six months of the financial year as it continued to recover from the impact of the Covid-19 pandemic.

Public sector borrowing fell to £108.1bn, down by £101.2bn in April-September 2020 but around three times its level before the pandemic.

Government borrowing fell to £21.8bn in September, a drop of around £7bn compared with September 2020, and lower than economists had forecast. It was also sharply lower than the £151.1bn the Office for Budget Responsibility had expected.

The data showed public sector net debt totalled £2.22trn, or 95.5% of gross domestic product.

Separately, a survey from the Confederation of British Industry showed manufacturing output grew steadily in October but supply pressures continued to rise.

The net score for output was 15% in the three months to October, broadly in line with 16% a month earlier and well ahead of the 3% long-run average. Output increased in 11 of 17 subsectors led by chemicals, aerospace, and food drink and tobacco.

The survey of 263 manufacturers found firms expected output growth to pick up substantially in the next quarter. Growth of new orders is expected to rise after slowing domestic orders affected October's performance.

In equity markets, miners were under the cosh again as metals prices fell, with Anglo American, Rio, BHP and Glencore all lower.

Barclays was trading down despite reporting a record £6.9bn of profit for the first nine months of 2021 as the securities business performed strongly and the retail bank released bad debt provisions made earlier in the pandemic.

Lancashire was the worst performer on the FTSE 250 as it said it expects net ultimate losses of between $165m and $185m from natural catastrophes including Hurricane Ida and European storms Bernd, Volker and Xero.

Meanwhile, greeting cards retailer Moonpig slumped after shareholders placed 30m shares, or a stake of around 8.8%, in the company.

On the upside, consumer goods giant Unilever rallied as it reported higher-than-expected third-quarter underlying sales growth, driven by higher prices and strong demand in the US, India, China and Turkey.

Relx gained after the company upgraded its full-year outlook for underlying growth rates in revenue and adjusted operating profit, as well as constant currency growth in adjusted earnings per share.

Engineer Renishaw surged to the top of the FTSE 250 after reporting a jump in annual profit and saying it had been "a positive year of recovery".

Market Movers

FTSE 100 (UKX) 7,185.43 -0.52%
FTSE 250 (MCX) 22,917.07 -0.22%
techMARK (TASX) 4,580.77 0.26%

FTSE 100 - Risers

Reckitt Benckiser Group (RKT) 5,572.00p 2.69%
Unilever (ULVR) 3,920.00p 2.64%
Relx plc (REL) 2,258.00p 1.94%
Halma (HLMA) 2,950.00p 1.79%
Hargreaves Lansdown (HL.) 1,559.50p 1.00%
Croda International (CRDA) 8,954.00p 0.95%
Bunzl (BNZL) 2,539.00p 0.87%
DCC (CDI) (DCC) 6,062.00p 0.76%
Auto Trader Group (AUTO) 611.60p 0.72%
SEGRO (SGRO) 1,274.50p 0.63%

FTSE 100 - Fallers

Anglo American (AAL) 2,706.00p -4.65%
BHP Group (BHP) 1,930.00p -3.64%
Rio Tinto (RIO) 4,708.00p -3.63%
Glencore (GLEN) 366.90p -2.92%
Lloyds Banking Group (LLOY) 47.89p -2.35%
Johnson Matthey (JMAT) 2,634.00p -2.12%
NATWEST GROUP PLC ORD 100P (NWG) 227.80p -2.02%
Rentokil Initial (RTO) 591.80p -1.95%
Smiths Group (SMIN) 1,426.50p -1.76%
Whitbread (WTB) 3,139.00p -1.75%

FTSE 250 - Risers

Renishaw (RSW) 5,140.00p 10.78%
Darktrace (DARK) 941.00p 3.24%
Vivo Energy (VVO) 106.20p 3.11%
Capital & Counties Properties (CAPC) 164.10p 3.08%
Syncona Limited NPV (SYNC) 186.80p 2.98%
Mediclinic International (MDC) 339.20p 2.60%
Shaftesbury (SHB) 618.00p 2.49%
Dechra Pharmaceuticals (DPH) 5,140.00p 2.19%
Oxford Instruments (OXIG) 2,385.00p 1.92%
Ashmore Group (ASHM) 329.60p 1.92%

FTSE 250 - Fallers

Lancashire Holdings Limited (LRE) 518.00p -6.50%
Moonpig Group (MOON) 333.60p -4.30%
Ferrexpo (FXPO) 306.80p -3.46%
JTC (JTC) 790.00p -2.83%
Petropavlovsk (POG) 24.28p -2.80%
WH Smith (SMWH) 1,521.50p -2.72%
Harbour Energy (HBR) 368.60p -2.54%
National Express Group (NEX) 218.00p -2.50%
Wood Group (John) (WG.) 230.70p -2.49%
Beazley (BEZ) 375.70p -2.47%


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