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London close: Stocks start week in subdued state

By Josh White

Date: Monday 27 Nov 2023

London close: Stocks start week in subdued state

(Sharecast News) - London's financial markets saw a somewhat subdued performance on Monday, as concerns regarding the Chinese economy cast a shadow over investor sentiment.

The FTSE 100 closed down 0.37% at 7,460.70 points, while the FTSE 250 showed a slight decline of 0.11%, settling at 18,438.55 points.

The dip in London stocks came on the back of renewed apprehensions about China's economic outlook.

During October, China experienced a deceleration in its industrial profit growth, triggering speculations that the government may need to implement additional stimulus measures to sustain economic momentum and prevent a downturn.

In currency markets, sterling was last up 0.02% on the dollar to trade at $1.2605, while it managed gains of 0.04%, changing hands at €1.1530.

"It's been a subdued start to the week for markets in Europe, following on from a weak Asia session, with a predominantly softish tone all around, as investors indulge in mild profit-taking after the strong gains of the last couple of weeks," said CMC Markets chief market analyst Michael Hewson.

"On the plus side, online estate agent Rightmove shares are among the best performers today, rising to give-week highs after upgrading its full-year outlook for revenue growth and average revenue per advertiser."

Retail sales decline slows in November

In economic news, fresh survey results from the Confederation of British Industry (CBI) showed that the decline in UK retail sales showed signs of easing in November, although a sombre outlook loomed over the upcoming Christmas season.

The CBI's monthly retail sales balance saw improvement, rising from -36 in October to -11 in November.

That still marked the seventh consecutive monthly decrease, with sales growth expected to remain marginally negative next month.

Despite retailers expressing disappointment over sales levels for this time of year, a modest recovery in sentiment was noted in November.

Businesses appeared cautiously optimistic, foreseeing a slight improvement in their business situations over the next three months.

"Retail sales have languished in negative territory for much of 2023, reflecting the impact of strained household finances on the sector's fortunes," said CBI principal economist Martin Sartorius.

"Though sentiment has picked up slightly, firms do not feel that a revival in activity is imminent.

"Given the weakness in trading conditions, it's little surprise that firms are scaling back on their investment ambitions."

Sartorius added that retailers had hoped the Chancellor's Autumn Statement would offer a reprieve from next year's hike in business rates.

"While prioritising relief for small-to-medium enterprises and key sectors is understandable, many retailers are being left to contend with another increase in costs at a time when they are least able to afford them."

Entain and AstraZeneca fall on broker notes, Rightmove rises

On London's equity markets, Entain was down 1.73% after a downgrade from Goldman Sachs.

The investment bank shifted its rating from 'buy' to 'sell,' citing a belief that fundamental improvements may take longer to materialise.

Goldman Sachs revised its earnings estimates down by approximately 30% for Entain's 2024 and 2025 financial years.

Pharmaceutical giant AstraZeneca was off 1.73% after a broker note from Jefferies, which lowered its price target on the shares from 13,000p to 12,500p.

On the upside, precious metals miner Fresnillo jumped 4.39% amid a rally in gold prices.

Rightmove added 4.6% after raising its full-year revenue per advertiser forecast.

The real estate marketing platform attributed the positive outlook to solid demand for its products since its last report, with the new average revenue per advertiser (ARPA) growth expectations now ranging from £112 to £116, up from the previous guidance of £103 to £105.

West End landlord Shaftesbury Capital was ahead 4.55% after the company celebrated a "strong" start to Christmas trading, reporting high footfall and sales tracking above the previous year.

Sales were notably up 12% compared to 2022 and 16% above 2019.

Johnson Matthey rose 3.14% following an upgrade from 'underperform' to 'buy' by Bank of America Merrill Lynch.

The upgrade was based on the belief that Johnson Matthey could extract more value from its clean air franchise through cost-cutting efforts and generate new revenue streams in its catalyst tech business.

Aviva also made headlines as it agreed to acquire Optiom from Novacap and other minority shareholders for approximately £100m.

Optiom, a managing general agent, specialises in providing vehicle replacement insurance in Canada and offers flexible payment options to its customers.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 7,460.70 -0.37%
FTSE 250 (MCX) 18,438.55 -0.11%
techMARK (TASX) 4,093.59 -0.67%

FTSE 100 - Risers

Rightmove (RMV) 533.60p 4.79%
Fresnillo (FRES) 551.40p 4.31%
Admiral Group (ADM) 2,709.00p 1.69%
RS Group (RS1) 767.40p 1.51%
Sainsbury (J) (SBRY) 276.20p 1.51%
Endeavour Mining (EDV) 1,760.00p 1.50%
Frasers Group (FRAS) 880.50p 1.44%
Sage Group (SGE) 1,119.00p 1.36%
Auto Trader Group (AUTO) 709.80p 1.31%
Barratt Developments (BDEV) 501.40p 1.29%

FTSE 100 - Fallers

St James's Place (STJ) 645.80p -2.42%
AstraZeneca (AZN) 9,976.00p -2.00%
BAE Systems (BA.) 1,049.50p -1.73%
International Consolidated Airlines Group SA (CDI) (IAG) 150.85p -1.60%
Flutter Entertainment (CDI) (FLTR) 12,420.00p -1.58%
Burberry Group (BRBY) 1,504.00p -1.57%
Prudential (PRU) 908.80p -1.39%
Rentokil Initial (RTO) 448.70p -1.38%
Smurfit Kappa Group (CDI) (SKG) 2,706.00p -1.02%
NATWEST GROUP (NWG) 203.90p -1.02%

FTSE 250 - Risers

Shaftesbury Capital (SHC) 120.70p 3.69%
Syncona Limited NPV (SYNC) 123.80p 3.17%
Johnson Matthey (JMAT) 1,590.50p 2.88%
Tritax Eurobox (GBP) (EBOX) 56.70p 2.53%
HICL Infrastructure (HICL) 136.80p 2.40%
Centamin (DI) (CEY) 92.25p 2.33%
Dr. Martens (DOCS) 111.00p 2.30%
Carnival (CCL) 1,023.00p 2.30%
Mitie Group (MTO) 99.30p 2.16%
Bellway (BWY) 2,436.00p 2.10%

FTSE 250 - Fallers

Ceres Power Holdings (CWR) 187.90p -3.84%
Indivior (INDV) 1,262.00p -3.52%
Jupiter Fund Management (JUP) 81.50p -3.15%
Hipgnosis Songs Fund Limited NPV (SONG) 69.00p -3.09%
888 Holdings (DI) (888) 77.80p -3.05%
Ithaca Energy (ITH) 154.40p -3.02%
Chemring Group (CHG) 310.00p -2.82%
Coats Group (COA) 67.50p -2.74%
FDM Group (Holdings) (FDM) 399.00p -2.56%
Apax Global Alpha Limited (APAX) 150.20p -2.47%

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