FTSE 100 Friday close: Blue-chips lose 2% as US market spooks traders

11th April 2014

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A turbulent session on Friday saw the FTSE 100 lose more than 1% on the day as weak trading in the US spilled over into the London market writes Philip Scott.

The index closed on Friday at 6,561.7, marking an 80.27-point drop on the day and a 2% fall over the week.

Across the pond, disappointing results from the US’s largest bank JPMorgan Chase spooked Wall Street traders sending indices lower.

Within the UK’s top flight index, shares in retailer Sports Direct International collapsed by 16% to 771p, representing the steepest fall amongst the blue-chip shares over the week as its billionaire founder Mike Ashley offloaded more than £200m worth of his own stock.

In what has been described as something of a surprise in a number of reports, Sports Direct also bought an 11% stake in department store firm House of Fraser just as a Chinese conglomerate bought 89%.

However the sentiment towards Sports Direct remains upbeat with the consensus among brokers being that the firm is a ‘buy’ and last week, analysts at investment banking giant Goldman Sachs reiterated their own ‘strong buy’ recommendation on the business.

The UK’s largest fund supermarket Hargeaves Lansdown also took a hit over the trading week, sliding 12% to 1,257p. Notably the City watchdog, the Financial Conduct Authority, revealed the group which endured technical problems during the Royal Mail sell-off, was the most complained about investment firm between July and December last year after more than 3,100 consumers lodged grievances.

British Airways owner International Consolidated Airlines Group also saw its shares take a tumble over the week, falling 11% to 392.1p while the still controversy-engulfed Royal Mail slid 10% to 495p after the regulator Ofcom said it would investigate complaints from rival TNT Post. Following the news brokers at UBS issued a downbeat note citing the “uncertainty” surrounding the business’s outlook.

Equipment rental firm Ashtead Group also saw its shares loosen by 10% to close at 880p, as did financial adviser St James’s Place, which finished at 764p.

In a week that did not see any stellar rises within the top 100, Asian focused bank Standard Chartered gained the most traction rising 5% to 1,321.5p as Investec Securities reiterated its “buy” recommendation.

Barclays, which according to the FCA was the most-moaned about firm by customers during the second half of 2013, with 309,494 complaints notched up, lost 5% to 236.05p. Lloyds, down 6% at 72.97p was the second most complained about, with a total of 256,656.

Elsewhere in the banking sector, Standard Chartered’s emerging markets competitor HSBC enjoyed a better week rising 1% to 617.6p, while Royal Bank of Scotland lost 4% to 306p.

Dove soap and Liptons Tea owner Unilever increased 4% to 2,635p while Tullow Oil rose by 3% to 827p as according to reports the Ghana National Petroleum Corporation, in which the refiner is a stakeholder could deliver more oil than expected.

Fresnillo enjoyed a 2% rise to 908.5p as Numis Securities upgraded its sentiment towards the stock to ‘buy’ while British Gas parent Centrica also increased 2% to 334.9p.

Next week sees updates and reports arrive from among others SABMiller, Tesco, Burberry and Diageo.

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