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FTSE 100: This morning’s risers and fallers

Lucinda Beeman
Written By:
Lucinda Beeman

Weak inflation data in China and Germany reignited fears about a global economic slowdown on Wednesday, pushing UK stocks sharply lower in morning trade.

The FTSE 100 was down 0.8 per cent at 6,341 in early deals, with the share price of Shire plummeting after the news that Abbvie is reconsidering its takeover offer.

The annual rate of Chinese consumer price inflation fell near to a five-year low of 1.6 per cent in September from 2 per cent a month earlier, showing that domestic demand still remains weak. However, it has raised hopes that the government will step in with further stimulus to avert a slowdown.

Closer to home, the German consumer price index(CPI) remained at 0.8% year-on-year in September as expected, with prices actually unchanged when compared with August 2014. “Germany’s CPI continuing to flat-line add[s] to deflationary and recessionary concerns in the Eurozone,” said Mike van Dulken, head of research at Accendo Markets.

UK employment data is forecast to show jobless claims fell 35,000 in September and the unemployment rate dropped to 6.1 per cent in August from 6.2 per cent in July. Employers are forecast to have added 30,000 jobs in the three months to August, while weekly earnings are expected to have risen 0.8 per cent over the period.

Stateside, a report on US retail sales will be in focus with analysts projecting a 0.1 per cent drop in September. Consumer spending is a major contributor to gross domestic product in the world’s biggest economy.

Shire sinks as Abbvie hopes fade

After US drugmaker Abbvie on Tuesday night said it was reconsidering its takeover of Shire, the UK company has pointed out it would be due a break fee of roughly $1.64bn if the deal falls through. However, that didn’t stop the latter’s shares from sinking by nearly 30% early on.

Chip designer Qualcomm will acquire UK-listed rival CSR for 900p a share or £1.56bn, causing shares in the latter to surge.

Engineering firm Weir was on the up after saying it is expanding its product offering in the minerals market with the $220m acquisition of Trio, a crushing and separation equipment business.

Infrastructure group Balfour Beatty saw its share price jump after appointing Qinetiq‘s chief executive officer Leo Quinn to take up the same position on its own board, starting at the beginning of 2015. Quinn has spent five years at Qinetiq, whose share price was sharply lower on Wednesday.

Mining stocks were mostly weaker in morning trade, including Fresnillo and Rio Tinto after poorly-received production upgrades. Mexican precious metals group Fresnillo said that silver production was flat over the third quarter but the output of gold slipped, while Rio Tinto underwhelmed with a record third quarter for its iron ore operations, though it left its guidance unchanged.

Travel and leisure stocks, which had been hammered as of late by concerns about the spread of Ebola, were putting in decent gains, including Easyjet, IAG, TUI Travel, Carnival and Intercontinental Hotels.

Market Movers
techMARK 2,627.40 -1.81%
FTSE 100 6,340.68 -0.81%
FTSE 250 14,747.64 +0.53%

FTSE 100 – Risers
easyJet (EZJ) 1,407.00p +3.30%
International Consolidated Airlines Group SA (CDI) (IAG) 349.10p +2.80%
TUI Travel (TT.) 345.10p +2.22%
Carnival (CCL) 2,255.00p +1.90%
Morrison (Wm) Supermarkets (MRW) 158.80p +1.47%
Hargreaves Lansdown (HL.) 882.00p +1.15%
InterContinental Hotels Group (IHG) 2,194.00p +1.15%
Whitbread (WTB) 4,045.00p +1.12%
Kingfisher (KGF) 294.10p +1.10%
Severn Trent (SVT) 1,940.00p +1.09%

FTSE 100 – Fallers
Shire Plc (SHP) 3,788.00p -26.30%
AstraZeneca (AZN) 4,231.50p -3.97%
Smith & Nephew (SN.) 944.50p -3.03%
Randgold Resources Ltd. (RRS) 4,282.00p -1.97%
Royal Dutch Shell ‘A’ (RDSA) 2,138.00p -1.66%
Fresnillo (FRES) 777.50p -1.64%
Tullow Oil (TLW) 511.00p -1.45%
Royal Dutch Shell ‘B’ (RDSB) 2,225.00p -1.40%
Rio Tinto (RIO) 3,125.50p -1.20%
Glencore (GLEN) 322.40p -1.15%

Source: ShareCast