LONDON MARKETS: FTSE 100 Closes In Negative Territory As BAT, BAE Systems Slump
22 Febrero 2018 - 12:20PM
Noticias Dow Jones
By Carla Mozee and Sara Sjolin, MarketWatch
Barclays to raise dividend; U.K. growth estimate revised
down
U.K. stocks ended lower on Thursday, underperforming the wider
European stock markets as heavyweights such as British American
Tobacco and BAE Systems declined after earnings.
Stocks were stuck in the red after data indicated U.K. economic
growth wasn't as strong as previously estimated. Among the market's
few advancers was banking heavyweight Barclays PLC after the
release of its financial results.
How markets are moving
The FTSE 100 indexfell 0.4% to close at 7,252.39, partly erasing
a 0.5% gain from Wednesday. By comparison, the pan-European Stoxx
Europe 600 index ended 0.2% lower.
The pound rose to $1.3943 from $1.3919 late Wednesday in New
York.
Check out: More investors looking to cut U.K. assets as Brexit
uncertainty persists
(http://www.marketwatch.com/story/more-investors-looking-to-cut-uk-assets-as-brexit-uncertainty-persists-2018-02-16)
What's driving markets
Equities in London had opened with steep losses, tracking
declines in the U.S. on Wednesday after Federal Reserve meeting
minutes suggested policy makers will raise borrowing rates at a
faster-than-expected pace.
The account of the Fed's January meeting
(https://www.federalreserve.gov/monetarypolicy/fomcminutes20180131.htm)
showed officials see an "increased likelihood" of further interest
rate hikes, heightening prospects of a rate rise in March. That
news helped push the U.S. 10-year Treasury note yield up closer to
the 3% mark, spooking investors out of stock.
However, stocks across Europe pared losses on Thursday afternoon
as Wall Street rallied after upbeat data on the U.S. labor market
(http://www.marketwatch.com/story/us-jobless-claims-drop-7000-to-222000-and-fall-back-to-45-year-low-2018-02-22).
Stock movers
British American Tobacco PLC (BATS.LN) (BATS.LN) fell 2.2%. The
maker of Lucky Strike and Dunhill cigarettes
(http://www.marketwatch.com/story/bat-2017-profit-soars-on-reynolds-american-buy-2018-02-22)
said its pretax profit increased more than fourfold in 2017, on
gains related to the acquisition of Reynolds American Inc. and
credits related to U.S. tax reform. Volume of sales of cigarette
and tobacco-heated products fell 2.6%.
BAE Systems PLC (BA.LN) dropped 2.7% after the defense company
reported full-year earnings below forecasts
(http://www.marketwatch.com/story/bae-systems-misses-profit-forecast-2018-02-22).
Barclays shares (BCS) surged 4.4% after the bank said it would
more than double its dividend next year
(http://www.marketwatch.com/story/barclays-swings-to-loss-vows-to-double-dividend-2018-02-22-34852558)
even as the bank swung to a full-year loss of GBP1.9 billion ($2.64
billion).
Centrica PLC (CNA.LN) climbed 7.5% as the British Gas parent
said it will cut 4,000 jobs by 2020 in an aim to reduce costs.
Annual adjusted operating profit dropped 17% to GBP1.25
billion.
Anglo American PLC shares (AAL.LN) posted 2017 net profit of
$3.17 billion
(http://www.marketwatch.com/story/anglo-american-profit-almost-doubles-in-2017-2018-02-22),
missing the $3.25 billion consensus estimate from FactSet. Shares
of the miner traded lower earlier in the day, but closed 0.2%
higher.
Economic data
The Office for National Statistics revised down its previous
estimate of U.K. GDP growth
(https://www.marketwatch.com/story/uk-economy-lagged-more-than-thought-in-2017-2018-02-22https:/www.marketwatch.com/story/uk-economy-lagged-more-than-thought-in-2017-2018-02-22)
in the fourth quarter to 1.4% from 1.5% year-on-year. The shutdown
of a major oilfield for repairs in December hit oil-and-gas
production harder than first believed, the ONS said.
What strategists are saying
"That stock markets remain in a volatile state is perfectly
illustrated by the latest session on Wall Street. Just as it seemed
traders had acclimatized to inflation, rising interest rates and
higher bond yields, the fears that caused this month's crash were
reignited by minutes from the Federal Reserve's last meeting," said
Lee Wild, Interactive Investors's head of equity strategy, in a
note.
"Every downtrend has rallies that catch people off guard, and
that is what we're seeing in Centrica [today]. While the FTSE 100
hasn't exactly soared over the past year, it is a stellar
outperformer compared to the 40% fall in Centrica. The shares are
still cheap on any number of metrics, which will probably see
today's bounce run a bit further, but this is still one to avoid,
even with a chunky dividend," said Chris Beauchamp, chief market
analyst at IG, in a note.
(END) Dow Jones Newswires
February 22, 2018 13:05 ET (18:05 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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