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FTSE 100: This morning’s risers and fallers

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UK markets bounced off a two-and-a-half week low on Friday following another record finish on Wall Street as investors took a positive approach ahead of the all-important US jobs report later on.

London’s FTSE 100 was trading at 6,831 early on, 0.25% higher than Thursday’s close of 6,813.49, its lowest finish since May 20th.

UK investors were underwhelmed yesterday by a string of new measures announced by the European Central Bank (ECB) yesterday in an attempt to stave off deflation and boost growth. However, US stocks performed well with the S&P 500 and Dow Jones Industrial both rising to all-time highs.

In an unprecedented move, ECB President Mario Draghi dropped the deposit facility rate into negative territory, effectively charging banks to keep their money at the ECB.

“This is the first time that a major central bank has used a negative rate strategy; it is significant from a risk viewpoint and can be viewed similarly to the ‘whatever it takes’ statement by Draghi in July 2012,” said Dawn Kendall from Investec Wealth & Investment.

Draghi also unveiled a string of new measures, including a 10 basis-point cut in the main refinancing rate to 0.15% and a package of up to €400bn of cheap loans to banks to encourage lending.

“With the market fuelled on stimulus hopes yesterday, attention will soon be shifted to the US pay-rolls report due later today,” said Lee Mumford, Financial Sales Trader at Spreadex.

Analysts expect data to show a 215,000 increase in non-farm payrolls in May, down from the particularly strong reading of 288,00 the month before. The unemployment rate is forecast to rise to 6.4% from 6.3%.

Bid targets Smith & Nephew and Centrica in focus

Medical devices maker Smith & Nephew retreated slightly as investors paused for breath after the stock’s strong run over the last few weeks amid speculation about a potential offer from three rumoured bidders: Johnson & Johnson, Stryker and Medtronic. The stock, down 1% today, is still 18% higher than a month ago.

British Gas owner Centrica was on the rise amid reports in the Daily Mail that it has attracted interest from Qatari investors.

Communication services group KCOM gained after saying that after a recent re-financing and with underlying cash flow strong, it is looking for investment opportunities to strengthen its position in target markets.

Pub grub and accommodation helped froth up annual sales and profits at pub and brewing group Fuller, Smith & Turner, which hiked its dividend by 11%. Shares rose strongly this morning.

Ultra Electronics edged higher after winning a three-year contract worth $19m with the US Navy.

FTSE 100 – Risers
Aggreko (AGK) 1,701.00p +2.72%
RSA Insurance Group (RSA) 487.90p +1.69%
Schroders (SDR) 2,652.00p +1.61%
Vodafone Group (VOD) 207.15p +1.54%
Smiths Group (SMIN) 1,342.00p +1.44%
Centrica (CNA) 334.90p +1.33%
Babcock International Group (BAB) 1,246.00p +1.30%
International Consolidated Airlines Group SA (CDI) (IAG) 408.90p +1.29%
Travis Perkins (TPK) 1,706.00p +1.25%
Mondi (MNDI) 1,110.00p +1.19%

FTSE 100 – Fallers
Diageo (DGE) 1,883.00p -1.15%
Smith & Nephew (SN.) 1,077.00p -1.01%
Burberry Group (BRBY) 1,481.00p -0.94%
Unilever (ULVR) 2,653.00p -0.86%
Morrison (Wm) Supermarkets (MRW) 191.10p -0.73%
Reckitt Benckiser Group (RB.) 5,080.00p -0.68%
Fresnillo (FRES) 788.50p -0.44%
Associated British Foods (ABF) 3,021.00p -0.43%
Tesco (TSCO) 290.40p -0.43%
SABMiller (SAB) 3,244.50p -0.38%

Source: ShareCast

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