7th February 2014
Following a dire start to 2014, the UK’s benchmark blue-chip index managed to make some headway in the first trading week of February gaining 1% to close at 6571.68 on Friday writes Philip Scott.
The index fell back on the day following the announcement of the latest US jobs update which showed that the world’s largest economy added just 113,000 jobs last month, under-shooting the predicted 185,000.
However the FTSE 100 managed to regain its losses and finish up, albeit by just 13.4 points on the day.
After being hit by the currency furor in Argentina, Aberdeen Asset Management shares bounced back strongly this week gaining, 7% to 419.8p, while troubled insurer RSA also enjoyed a 7% climb to close at 104.2p, making both the week’s top risers on the leader-board.
Also enjoying gains were house builders Travis Perkins, 6% up at 1,846p and Persimmon, firming 5% to 1,385p. Randgold Resources is still enjoying the change of heart towards gold and precious metal miners, after moving 6% ahead to 4,424p while Rio Tinto added 5% to 3,407p and Tullow Oil rose 6% to 836.5p.
Britain’s largest fund supermarket Hargreaves Lansdown was the week’s steepest faller, down 9% to 1,353p after its first half results disappointed, where profit margins edged back, from 65.6% to 65.2% at the end of 2013.
Also off was specialist manufacturing investor Melrose Industries which slipped by 5% over the week to close at 295p while British chip designer ARM Holdings fell 4% to 896p despite the group meeting earnings expectations in the fourth quarter.
While its sales were subdued, Vodafone’s quarterly results were in line with City expectations and both Citigroup and Deutsche reiterated their ‘buy’ recommendations on the stock, however not everyone was convinced by the telecommunications group’s update and its shares slid 2% to 222p.
Bankers and their remuneration were still dominating the news this week where it was reported that Lloyds Banking Group, off 2% at 81.8p, would be awarding chief executive officer Antonio Horta-Osorio a bonus of up to £2m.
But Barclays’ boss Antony Jenkins, decided to decline his bonus for the second year running as a result of regulatory costs and a £6bn fundraising.
In a statement, the bank’s chief executive officer, who was up for a bonus of up to £2.75m, said “it would not be right, in the circumstances”. Over the week the bank’s shares are flat at 271.7p, as are HSBC at 627.8p and Standard Chartered at 1,240p.
UK business minister Vince Cable cautioned that Royal Bank of Scotland, off 1% at 337.5p, could move its headquarters out of Scotland if the country votes in favour of independence.
In addition, the row over the privatisation of Royal Mail, off 2% at 589p, came to a head once again after it was revealed that investment banks had estimated the firm’s value at up to £1.5bn more than its flotation price.
Next week sees updates arrive from, among others, Glencore Xstrata, Barclays and Rolls Royce.