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FTSE 100 loses Thursday’s gains to close firmly in red as US virus fears swirl

  • FTSE 100 closes 83 points lower
  • US markets closed today
  • Fuller's delays publication of its finals

5.10pm: FTSE closes in the drink

FTSE 100 index closed in the red Friday as virus fears circulated again and ahead of the UK's so- called 'Super Saturday'.

This weekend sees lockdown measures easing further, to include the reopening of pubs and restarurants.

Britain's blue-chip benchmark finished down around 83 points, or 1,33%, at 6,157.

It was also a low volume trading day in London as Wall Street was closed due to the July 4 holiday. The decline on Footsie meant yesterday's gains on the UK's top share index were eroded as health fears swirled.

"A rise in virus deaths in a number of US states proves that, sadly, Covid-19 does not take holidays, and should remind everyone that this crisis is far from over," said Chris Beauchamp, market analyst at spreadbetter IG

"While the reaction has been magnified because of the lack of volume today, we should not write off this move entirely, especially as we head towards the next earnings season," he added.

Over the week as a whole, Footsie was barely changed, dropping a shade at 0.003%.

3.00pm: (Some) Pubs to reopen in England from 6.00am tomorrow

Fallers outnumber risers by four-to-one among Footsie constituents on what has been a drab day for equities.

The FTSE 100 was down 74 points (1.2%) at 6,166, just 15 points above its lowest level of the day.

The government has announced that pub-goers in England will have to wait a whole six hours tomorrow to enjoy their first pint – or pub breakfast – as it has been decreed that pubs can open for business from 6.00am.

Fuller, Smith & Turner PLC (LON:FSTA), the London-focused pubs group, said today that just 27 pubs from its estate would reopen tomorrow as it intends to conduct a phased reopening programme.

The company expected more than four-fifths of its pubs will be open by the end of the month.

Fullers shares were down 2.1% at 742p after the company, which was due to declare its full-year results today, postponed the publication of the figures.

12.45pm: The Footsie pares its losses

After looking like it was going to continue gently subsiding all day, the Footsie bucked its ideas up just before noon.

The index of big-cap stock still remains 65 points (1.0%) in the hole at 6,176 but has at least shaken off the lassitude of the morning.

There is a bit more backbone being shown by the FTSE 250, which is only down 41 points (0.2%) at 17,326, thanks in part to a positive response to the trading update from Essentra PLC (LON:ESNT).

Things are still pretty tough for the packaging specialist but are steadily improving.

READ Essentra sees slow recovery but expects continued disruption

Essentras shares were up 11% at 325p, which was not even enough to put it atop the FTSE 250 leaderboard; that accolade went to Puretech PLC (LON:PRTC), which was up 11% at 293p.

Away from the FTSE 350, controversial loans company Amigo Holdings PLC (LON:AMGO) was the top riser, surging 40% to 11.86p after it agreed with the regulator on a schedule to get its house in order in terms of dealing with a mountain of complaints.

The British Bulls has just updated #Amigoholdings signal to BUY

Signal Update #AMGO $AMGO: Our systems recommendation today is to BUY.

The BULLISH HARAMI pattern finally received a confirmation https://t.co/0ilbVhGVcp pic.twitter.com/tUsQX6KOQW

— John Anderson (@JohnAnderson_10) July 3, 2020

11.00am: Market's gentle roll downhill picks up pace

Like a cricketer trying to reach a score in singles, the FTSE 100 crept slowly to a “fifty” – a 50 point fall, that is – during the second half of the morning session.

Londons index of heavyweight shares was down 57 points (0.9%) at 6,183, with propulsion systems developer Rolls-Royce Holdings PLC (LON:RR.), down 4.2% at 280.1p, leading the fall.

On what has been a dull day, the UK services Purchasing Managers Index for June, which was practically unchanged from the “flash” estimate, did little to provide excitement.

“Few dared imagine it but on this evidence, the Great British Bounceback is on,” proclaimed Ulas Akincilar, the head of trading at the online trading platform, INFINOX.

“This is gravity-defying stuff, and while not a total surprise – earlier flash figures gave us a clue what to expect – it is a huge, caffeinated shot in the arm for UK market sentiment,2 he added.

“Of course millions of service sector workers are still working from home, but this data suggests their output – and demand for their work – are holding up well.

“With the hardest-hit subsector of the service industry – hospitality – finally set to reopen its doors tomorrow, at this rate July could even see the industry climb back into positive territory.

“Its far too soon to talk of green shoots, and the virus remains a clear and present threat but following its vertiginous plunge and Lazarus-like recovery, the services PMI graph is looking remarkably v-shaped after all,” Akincolar declared.

Howard Archer, the chief economic adviser to the EY ITEM Club, was a bit more restrained in his analysis, saying that the contraction in services activity was “relatively limited”,

“Markit reported that that the easing of restrictions related to COVID-19 had a favourable impact on economic activity in June, with business operations gradually resuming in a number of sectors and staff brought back from furlough.

“Nevertheless, it is evident that the UK economy suffered a record, substantial GDP contraction in the second quarter. We suspect that the economy likely contracted around 17% quarter-on-quarter in the second quarter. We expect the economy to return to clear growth in the third quarter with GDP expanding close to 10% quarter-on-quarter. This assumes a further easing of lockdown restrictions, including a relaxation of social distancing rules. We currently expect GDP to contract around 8.0% over 2020,” Archer said.

The composite PMI posted significantly improved balances for the second consecutive month but remained in negative territory. Whilst the worst of the downturn has passed, activity continues to be hampered by subdued demand, weak export performance and capacity constraints. pic.twitter.com/lyuZXgxkzB

— CBI Economics (@CBI_Economics) July 3, 2020

10.15am: Services sector recovers

The UK Service sector Purchasing Managers Index for June rose to 47.1 from 29.0 in May. The “flash” estimate for June was 47.0.

A reading below 50 indicates a contraction.

Around 33% of the survey panel reported a drop in business activity during June, while 28% signalled an expansion. The proportion of service providers experiencing a fall in business activity has eased sharply from 54% in May and 79% in April, said IHS Markit, which conducts the survey.

“June data highlights that the worst phase of the service sector downturn has passed as more businesses start to reopen and adapt their operations to meet social distancing requirements,” said Tim Moore, the economics director at IHS Markit.

"Encouragingly, more than one-in-four service providers reported an expansion of new business during June, which was commonly attributed to pent up demand and the phased restart of the UK economy; however, lockdown measures continued to hold back travel and leisure, while companies across all main categories of service activity commented on subdued underlying business and consumer spending in the wake of the COVID-19 pandemic,” he added.

Duncan Brock, the group director at the Chartered Institute of Procurement & Supply, said the services sector emerged “tentatively from the shadows last month”.

"Though the sector remained in overall contraction territory, the re-opening of businesses premises unclogged levels of dampened demand and created hope that the worst impact of the pandemic could be over; however, as consumers remain fairly cautious, tightening purse strings, the highest levels of business optimism in four months may be a little premature.

"Pipelines of new work were still severely weakened for the fourth consecutive month, and export orders were still in dire straits. With imposed travel and logistics restrictions disrupting supply chains overseas clients shied away from placing orders as the pandemics presence is still felt,” Brock said.

The FTSE 100 was down 36 points (0.6%) at 6,204.

While composite June #UK #PMI #services & #manufacturing output index of 47.1 still points to contracting activity, it did little to dilute belief UK economy is growing again. The 17.7 point increase in the composite index in June was a record since series started in Jan 1998 https://t.co/T1OVLWfXd6

— Howard Archer (@HowardArcherUK) July 3, 2020

9.35am: Land Securities to do the REIT thing and reinstate dividends

“Subdued” is the word to describe early activities in London on Friday. “Comatose” is another.

The FTSE 100 loitered around last nights closing level for an hour or so but has now embarked on a sedate retreat to 6,215, down 25 points (0.4%).

With the US markets closed today ahead of the July 4 celebrations, traders may well be taking the opportunity to close positions early ahead of the weekend and the July 4 pub reopening celebrations.

“In a taste of what could be the tone for the rest of the session, things got off to an awfully slow start on a US-free Friday,” reported Connor Campbell at Spreadex.

“Investors reticence is understandable. For though the US markets wont be around to set the pace later this afternoon, news from America certainly is, with the country once against seeing a fresh record number of one-day COVID-19 cases. Thursday saw a further 55,220 infections, clearing Wednesdays high by around 2,500.

“Alarmingly for Florida, the state made up almost exactly a fifth of those cases, in a stark example of what happens when you have the laxest lockdown measures imaginable.

“The blow of this news was countered somewhat by a very strong Caixin services PMI out of China. At 58.4 the reading easily smashed expectations, suggesting a robust comeback from the superpower,” he added.

Financial stocks are among the weakest blue-chip performers, with investors showing little enthusiasm for insurers RSA Insurance Group PLC (LON:RSA), Prudential PLC (LON:PRU), Aviva PLC (LON:AV.) and Legal & General Group PLC (LON:LGEN) or banking giants Lloyds Banking Group PLC (LON:LLOY) and Standard Chartered PLC (LON:STAN), all of which are down by more than 1%.

Land Securities PLC (LON:LAND) was the top blue-chip performer, rising 2.6% to 590p after it updated the market on rent collection in June.

LandSecs said £109mln of rent was due on June 24 (after taking concessions and deferrals into account), and 60% of this was duly coughed up within five working days compared with 94% for the equivalent period of last year.

The board felt confident enough in the recovery to flag that it intends to reinstate dividend payments following the interim results statement due on November 10.

Land Securities collects 60% of rents, to resume dividends in November

— Phoenix Capital ???? (@PhoenixSquawk) July 3, 2020

8.50am: Slow start to week's end

The FTSE 100 looks set for a quiet end to the week with the US taking a public holiday ahead of the Independence Day celebration.

In early trade on Friday, the Footsie was down 7 points at 6,233.72.

Excitement over the early US jobs figures, released on Thursday, appears to have dissipated, likewise, theres been a reality check to coronavirus vaccine hopes, which had also been keeping the markets buoyant.

Not even the fastest expansion in Chinas services sector for eight years could entice the buyers out.

Here at home preparations are being made for a re-opening of large swathes of the UK economy on what has been dubbed Super Saturday, though there are some worried it may cause a second surge of coronavirus (COVID-19) deaths.

Rank (LON:RNK) was boosted 3% after it said it would begin to open its Mecca Bingo halls.

Aston Martin Lagonda (LON:AML) fell 4% after Deutsche Bank cut its price target for the stock.

Among the minnows, fastjet (LON:FJET), the Africa-focused budget airline, fell 17% after providing a stark update to investors.

On the up – and ahead 14% – was technology firm Catenae Innovation (LON:CTEA), which inked a deal to take its blockchain ID technology to Botswana.

Proactive news headlines:

Catenae Innovation PLC (LON:CTEA) has unveiled two significant developments – one commercial, the other technological. The former first: the blockchain specialist has agreed a deal with a newly-incorporated firm called Afrik-ID, set up by Botswanas former US ambassador David Newman. Afrik-ID will pilot test over the next four months Catenaes Onsite ID and Cov-ID technologies in the country “to ascertain their commercial viability”. In a separate announcement, Catenae said it had completed work on its Onsite ID product having slowed progress to develop, pilot and launch the Cov-ID coronavirus passport app.

SigmaRoc PLC (LON:SRC) said its Belgian subsidiary, Carrières du Hainaut (CDH) has signed an agreement with the Walloon government to co-fund infrastructure works in the context of its quarry extension project at the town of Soignies. The construction materials group said CDH will fund €700,000 of the estimated €3mln project, which is expected to commence later this year and consist of the displacement of two sections of public road currently separating 116 hectares of CDH's 351 hectares of permitted land and minerals from its main quarry site. SigmaRoc said once these works are finalised CDH will begin installing a new crushing and screening plant, enabling it to move forward with extracting construction aggregates and high-grade limestone at the extension area.

Power Metal Resources PLC (LON:POW) has said the pitting and mapping exploration programme at its Kisinka copper-cobalt project has confirmed copper anomalous areas. The programme on the 70%-owned project, located in the southern part of the Katangan copper belt in the Democratic Republic of the Congo, was carried out over 40 days. In all, 211 samples including 11 field duplicates were collected and after sample preparation at the PreparatioRead More – Source