FTSE 100 dives below 6,000

04/30/2020 Business



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“Yesterday’s risky party has left participants a bit of a hangover: risky assets have taken a beating today amid a lot of pretty rotten economic data,” said Neil Wilson of markets.com.

  • FTSE 100 loses 171 points
  • Companies that invest heavily in world markets lick
  • searched in hopes that he can have a coronavirus treatment ready next year

3:45 pm: risk-free day for stocks

It is definitely a “risk free” day today, in London and elsewhere.

The FTSE 100 fell 171 points (2.8%) to 5,945, with companies heavily invested in global markets among the worst affected.

(LON: JL.) Down 12% to 1,450.5p, () down 6.3% to 224.6p, Aviva PLC () down 6.0% lighter to 244.2p, and () down 5.9% lighter to 281.9p.

Fewer than a dozen Footsie shares were in positive territory and these included defensive favorites, such as pharmaceutical giant AstraZeneca PLC (), a 3.1% rise to 8,463p, and utilities companies PLC (), ( ) and United Utilities PLC (), all of which made small profits.

AstraZeneca was higher in the hope that it could have a COVID-19 coronavirus treatment ready by next year.

“Yesterday’s risk party has left the participants with a bit of a hangover: risky assets have suffered a severe beating today amid a lot of rather rotten economic data and a pressure from the ECB that perhaps was not all that, “said Neil Wilson on the .com markets.

“There is also a feeling that the stock markets were overly aggressive in the Gilead news and need to see more evidence, while the FTSE has underperformed thanks to the big oil companies,” he added.

2.55pm: optimism is suddenly in short supply

Stocks got off to a weak start in the US. USA After some gloomy job numbers.

The Dow Jones Industrial Average fell 283 points (1.2%) to 24,351 while the S&P 500 fell 25 points (0.8%) to 2,915.

“Initial jobless claims in the US decreased to 3.8 million during the week ending April 25 from 4.4 million the week before, bringing their total in the past six weeks to 30, 3 million, “reported Berenberg Capital Markets.

“Although initial claims decreased 44% from their peak in late March, the pace of declines has slowed, suggesting unemployment will continue to rise at least through May.

* Continuing unemployment insurance claims, reported with a two-week delay, rose to 18.0 million during the week ending April 18 from 15.8 million in the prior week, nearly tripling its Great Pre-COVID maximum 2008-2009 recession, “he added.

James Knightley, ING’s chief international economist, noted that “with an additional third of economically inactive youth ages 16 to 65, less than half the working-age population of the United States will earn a salary in May.”

“In an election year, this means that the call for politicians to reopen the economy will only get stronger, regardless of the health councils,” he suggested.

In Europe, Christine Lagarde, the governor of the European Central Bank (ECB) has not exactly covered things at the ECB’s monthly press conference.

She had forecast a 15% decline in the European economy in the second quarter.

ECB economists believe the economy will shrink between 5% and 12% this year.

“Given the sharp contraction of the Eurozone’s GDP in the first quarter of -3.8% quarter-over-quarter and a much worse decline in the second quarter, it is only a matter of time before the ECB will act again,” predicted Anna Stupnytska, Director of Global Macro at Fidelity International.

Complicating the ECB’s dilemma is, perhaps unsurprisingly, the ongoing delay in the European Commission’s bold fiscal action. Like details on crisis instruments across the area, including the ESM lines and the fund. The recovery instruments are not yet finalized, the ECB has to continue to do the heavy lifting. As things stand, these instruments are unlikely to be available until later in the year or, in the case of the recovery fund, early next year, “he added.

It’s no wonder investors in London are licking their wounds, with a decline in the FTSE 100 that stretches to 153 points (2.5%) at 5,962.

13:45 h: applications for unemployment for the first time in the USA. USA Increased by 3.8 million

EE indices are expected. USA They open lower after another grim weekly job report.

Extended betting quotes suggest that the Dow Jones Industrial Average will open around 24,490, down 144 points at the close last night, while the S&P 500 is tilting to shed 12 points to start at 2,928.

Unemployment claims for the first time last week in the US USA They totaled 3.8 million, which is at least a slowdown in claims of 6.9 million at the end of March, but it means that the number of people claiming unemployment benefits for the first time has increased by about 30 million. in just six weeks or so.

In Europe, the European Central Bank (ECB) has announced additional liquidity operations, but did not come to further quantitative easing (QE).

“There will be a new series of long-term emergency refinancing operations (PELTRO) not aimed at an emergency pandemic. There will be seven PELTROs and they will be held at 25bp below the benchmark rate through September 2021. After various adjustments to the TLTROs at the last meeting, this is yet another attempt to provide more liquidity to the banking sector and therefore to the real economy. “Carsten Brzeski, chief eurozone economist at ING said.

“The decision to keep all the other instruments unchanged shows that the ECB first wants to take stock of all the measures recently taken. You probably also want to keep some dry powder. And, this dry powder is necessary, since the current GDP data have given us the first impression of how serious the crisis is in the eurozone, ”he added.

In London, the FTSE 100 has a triple digit loss at 6,013, a decrease of 102 points (1.7%).

12.45pm: Lloyds and fight for the wooden spoon

The Footsie was at its lowest point of the day midway through the nighttime wading session, sentiment buffeted by updates to two index heavyweights.

The London Leading Stock Index fell 81 points (1.3%) to 6,034, with oil giant PLC () about to deny PLC () the wooden spoon.

The former fell 7.7% to 1,339.2 p after announcing a dividend cut this morning, while lender Lloyds lost 7.6% to 32,115 p after its first-quarter earnings fell.

“Often viewed as a barometer of the UK economy, this Lloyds update underscores the scale of the challenges ahead,” said Richard Hunter, an interactive investor.

“Overall, the impairment provision of £ 1.4 billion is higher than the previous figure of £ 275 million, and has practically erased first quarter earnings,” he said.

11.30am: the downward drift continues

Real gross domestic product (GDP) in the euro zone sank 3.8% quarter-on-quarter in the first quarter, in line with market expectations.

On an annual basis, GDP fell 3.3% after increasing 1.0% in the fourth quarter of 2019.

Unemployment in the euro area rose to 7.4% in March, from 7.3% in February; The consensus forecast had been for an unemployment rate of 7.8%.

The headline inflation rate in the Eurozone decreased to 0.4% in April from 0.7% in March, confounding economists’ predictions of a fall to a 0.1% rate.

“It’s almost funny that in a quarter where estimates are probably as uncertain as they have been, the initial GDP headline is exactly in line with the consensus.” The revisions are guaranteed, we believe they will be downward, but overall, these numbers are probably a fair reflection of the situation on the ground in the first quarter, “said Claus Vistesen, chief eurozone economist at Pantheon Macroeconomics.

Meanwhile, the ever-useful daily Pantheon coronavirus update notes that deaths in UK hospitals continue to decline, but the government has been pressured to include deaths in nursing homes in the figures, which has increased the number. deaths in 3,811.

“Confirmed cases in the United States rose 2.7% yesterday, down from a 3.5% increase on the same day last week. The rate of decline in cases has slowed, but is now stable, “said Ian Shepherdson, chief economist at Pantheon.

Further, on a day when many surprised the market by cutting their precious dividend, Christian Nolting (CEO of Global Investments) and Markus Müller (Head of the Global Head Investment Office) predicted that “the post-coronavirus world will likely it will be characterized by lower yields for a longer time, despite higher loans ”.

“At the corporate level, those sectors that are best suited will do better and we are likely to see failures elsewhere. Corporate earnings are likely to fall beyond current consensus estimates. Following long-term investment issues can help navigate this difficult picture, “they suggest.

The FTSE 100 fell 35 points (0.6%) to 6,081.

10.00am: Good and bad news from the Anglo-Dutch giant

In the battle of the Anglo-Dutch giants, the decline of PLC () is outpacing the rise of PLC ().

The FTSE 100 fell 25 points (0.4%) to 6,090 with Shell, 6.3% to 1,359.6 p, which led the withdrawal after it shocked the market by reducing its interim dividend.

“Although very unusual, this cut was not unexpected given that the price of oil plunged 60% in the first quarter when the market responded to the Covid-19 outbreak, the huge oversupply caused by the dispute between Russia and Saudi Arabia and rising expectations of a sharp decline in future economic activity The market naturally responded negatively to the measure, “said Ian Forrest, an investment research analyst at The Share Center, perhaps suggesting that the measure was unexpected at least in some quarters.

“Investors are probably focusing on how the company expects the factors behind its decision to last beyond this year and may therefore fear that dividends may be at current levels for some time,” Forrest added.

Speedy consumer goods maker PLC () was on the sunnier side of Footsie Street, a 3.9% increase in art from 6,654p after its first-quarter commercial update.

Some wiggles have suggested that the company has benefited from unconventional medical advice provided by President Trump regarding the use of chlorine, but Emilie Stevens, a capital analyst at Hargreaves Lansdown, noted that the company has many other heavyweight brands.

“We hope that no one injects RB’s products, but the public certainly buys them in bulk: sales of products like Neurofen increased by a third and cleaning products like Lysol and Dettol were not far behind,” said Stevens.

“This growth is likely to have exceeded RB’s wildest expectations and as a result, RB expects a better year ahead. However, RB was quick to point out that this level of demand may be short-lived, by the time The group said it is difficult to distinguish between storage, effectively overtaking future sales, and an underlying surge in demand. Since a vaccine is at least a year from now and hygiene is proving to be a serious advocate for Covid, it is not Unlikely to think that sales will continue to be higher, but it is unclear for how long and how high.

“Given that the recent 2020 strategic renovation was already going to be a great year for Reckitt, Coronavirus has provided a huge boost, but RB still has its work cut,” he added.

8.45am: bad day for the news

The FTSE 100 overcame an early trade recall Thursday as (B) criticized what was supposed to be a positive start to the proceedings by cutting its dividend for the first time since World War II.

The move erased 7% of A and B shares, which, due to their index weighting, turned out to be a significant swing factor. However, oil group BP () was unaffected by Shell’s shock move as it left its quarterly payment unchanged earlier this week.

The UK’s First Class Stock Index shed 12 points at 6,103.64 from the start. It was expected to be a more sunny start for the procedures, particularly with the Dow Jones Industrials Average closing more than 500 points on Wednesday amid optimism about Gilead’s possible treatment for acute coronavirus symptoms (COVID-19).

Shell was not alone in spreading the gloom. The quarterly update of () seemed as appetizing to the market as a bucket of colds with 3.6% shares, dragging with them (), a 3.5% drop.

“Lloyds feels the difficulty of not having a big investment bank,” said Nicholas Hyett, analyst at Hargreaves Lansdown.

“While it rivals Barclays and has seen an increase in business activity that offsets weaker interest income, Lloyds should be hit on the chin. The drop in the base rate meets earnings are much lower and bad loan provisions have decimated earnings.

“Fortunately, the balance sheet has proven to be more than capable of handling the pressure in the first quarter, and the cancellation of the dividend means that the bank’s key equity ratios have really improved.”

On the plus side, gaming giant Flutter Entertainment () was up 5.6% after confirmation that the merger with Stars Group will be formally completed next week.

Finally, trade in the first quarter of () generated a 5.4% rise in the share price of the Anglo-Dutch consumer goods giant.

Proactive news headlines:

PLC () said it discovered a new gold mineralized outcrop on its Glenish gold target in the Longford-Down gold trend. The gold exploration and development company said that channel sampling at the Glenish gold target has identified gold in bedrock – 1.0 meters (m) at 0.4 grams per ton (g / t) – from a gouge outcrop of Sand, with pyrite mineralization. This recently discovered gold outcrop is located more than 500m northeast of gold in rock rock previously intersected by drilling and improves the overall prospectivity of the Glenish gold target, Conroy said in a statement.

() said that it focuses on the “optimal route forward” for the business that includes the development of phase III of its key asset, Lupuzor, but that it will also focus on new and future portfolio candidates. Its nurturing and peptide programs appear to have the potential to open three therapeutic areas: cancer, metabolism, and anti-infectives. ImmuPharma also told investors, as it reported full-year 2019 results, that it was looking at other possible uses of the autoimmune disease for Lupuzor, other than treating lupus.

BATM Advanced Communications Limited () has released a coronavirus-focused update saying the pandemic has not been so bad for their business. The group expects its biomedicine division to perform well during the global shutdown period and for the network and cyber division to experience a temporary slowdown. Given the uncertainty surrounding the duration and economic severity of the crisis, it is too early to estimate the financial impact on the company for all of 2020, said the provider of real-time technologies for network solutions and medical laboratory systems. As previously announced, BATM has released a new coronavirus detection diagnostic kit (COVID-19) that received certification in March 2020.

PLC () (NASDAQ: VRNA) outlined the plans for the coming months as it was updated at a busy start to the year and confirmed that it is financially well placed. The company is focused on developing discoveries like ensiphethrin for respiratory conditions like chronic obstructive pulmonary disease (COPD). The focus for the future is on preparing for what is called an end of phase II meeting with the US Food and Drug Administration. USA To discuss Verona’s success in delivering the medicine using a nebulizer. Scheduled for this quarter, the formal conversation with the US regulator will guide the design of a phase III study.

PLC experienced 11.6% year-on-year growth in the amount of money loaned in the first quarter of 2020. The lender, which operates in Russia and targets borrowers who are not well served by conventional lenders, said the amount financed in the first the quarter rose to £ 2.55 million from £ 2.32 million a year earlier and £ 2.28 million in the previous quarter. The amount borrowed fell slightly in March when the effects of the coronavirus (COVID-19) began to take hold. In April, the lender said it saw a significant decrease in demand, leading to an expected decrease of about 44% year-on-year in the amount financed, which the company attributed to the reduction in the crosswalk in Moscow as a result of the measures enacted with respect to COVID-19.

() has reported “exceptional” drilling results from the Haieron deposit in Western Australia, confirming the continuity of higher grade mineralization. The latest drilling results expand the footprint of mineralization within an arcuate sulfide zone, as well as the surrounding proximal gap, the company said in a statement. The highlights of drill interceptions included grades up to 9.3 grams per tonne (g / t) over 22.8 meters n (m), in addition to seeing other cuts with grades of 6.2 g / t, 4.4 g / t and 3.8 g / t.

() said he has secured £ 250,000 in additional funds through a loan with NatWest to increase his working capital and continue his planned construction program for 2020. The media firm said the loan, awarded through the interruption scheme Backed by the UK government, it will be fully withdrawn and repayable in 12 monthly installments, the first of which expires 13 months after withdrawal. The company also said that, in line with the UK’s job retention scheme, it has extended the leave of around half of its full-time workers until the end of June, as well as implementing a 50% pay cut. for all staff earning more than £ 2,500 per month.

() has reported a jump in revenue for the full year as its underlying losses (LBITDA) fell by around 50%. For the year ended December 31, 2019, the Africa-focused logging group noted that revenue had increased 45% yoy to $ 19.5 million, while its LBITDA from continuing operations dropped to $ 1.9 million from US $ 3.8 million. The company also said that recovery rates from its sawmill in Gabon had increased to 40% from 33% during the year, while after the period it had resumed operations in Mozambique after more than two years.

European Metals Holdings Limited (LON: EMH) said the Czech Environment Ministry granted Geomet the preliminary extraction permit related to the northwestern part of the Cinovec deposit. The group said the permit, which is a necessary legal prequalification before obtaining a final mining permit, has been issued for an 8-year period and guarantees the company the priority right to request and obtain a final mining area and final mining. Excuse me. He noted that the preliminary approval for the northwest part of the deposit covers an area of ​​1.27 square kilometers and, together with the existing preliminary mining permits, now covers the entire Cinovec ore reserve.

() (), the base metal and gold / silver producer at the Hellyer gold mine in Tasmania, announced that it has appointed Limited as its corporate agent, effective immediately, together with First Sentinel, who is the financial advisor to the Aquis Exchange of the company. The company noted that it is a specialist in the natural resources sector and provides ongoing long-term advice to publicly-listed companies on all aspects of interaction with new and existing shareholders, as well as capital research.

(), the mining company listed on AIM, said that it decided to pay the interest of $ 29,591.45 maturing on April 29, 2020, on the bond of $ 7,101,947 issued to Atlas announced on January 31, 2020 for the issue of 15,582,523 Shares priced at 0.15327 peach. He noted that, under the terms of the Atlas Bond Issue Deed, the company has the right to choose to pay the interest on the shares at an issue price of 90% of the Volume Weighted Average Price of the shares on the business day prior to interest. Payment date.

6.45am: Rally ready to continue

It seems that the stock market recovery will resume in the face of front-line financial results, as sentiment is controlled more in the hope of returning to “normal” than counting the costs of blocking the coronavirus (COVID-19) until the date.

In London, the FTSE 100 is predicted to open around 60 more points, with IG Markets priced from 6,182 to 6,185 with just over an hour to open.

This morning brings updates from (), (), (and J Sainsbury’s () plus several more: Most of the business news and financial results will not be a pleasant read for shareholders.

More generally, macro attention will focus on the first economic indicators for April.

However, it is largely news from a US company that is driving the global stock market, as the Gilead Sciences Inc () trial of the drug remdesivir showed some effectiveness in treating patients with COVID-19.

“This news simply acted as an even stronger tailwind for equities as markets searched beyond the data for the promised land of an economy emerging from the blockade and slowly restarting in the context of a treatment for Covid -19, quickly followed by a shot, “said Michael Hewson, analyst at CMC Markets.

“Hopefully this rosy view of the rest of the year does not collide with the harsh reality of profit elimination as consumer spending struggles to rebound in a context of caution and high unemployment.”

Last night in New York, the Dow Jones Industrials Average gained 532 points or 2.21% to close at 24,633. Similarly, the broader S&P 500 Index advanced 2.66% to end at 2,939 on Wednesday and the Nasdaq Composite strengthened further, adding 3.57% to end the session at 8,914.

In Asia on Thursday, Japan’s Nikkei rose 539 points or 2.74% to 20,312, while Hong Kong’s Hang Seng added 0.28% to 24,643 and the Shanghai Composite gained 1.22% to 2,857.

Around the markets:

  • The pound: US $ 1.2480, an increase of 0.09%
  • Gold Price: $ 1,712 per ounce, 0.1% less
  • Brent Crude: US $ 24.62 per barrel, up to 20.33%
  • WTI Crude: US $ 17.16 per barrel, 39% more
  • Bitcoin: $ 9,278, an increase of 17%

Significant announcements expected for Thursday:

Commercial Ads: PLC (), PLC (), Grupo PLC (), PLC (), St James’s Place PLC (), PLC (), (), (), Hikma Pharmaceuticals PLC (), (), (), PLC (), (), Lancashire Holdings Ltd (), (), (), Kaz Minerals PLC (),

Finals: (), (), Ocean Outdoor Limited (), ()

Intermediates: Up Global Sourcing Holdings PLC (), Apax Global Alpha Limited (LON: APAX)

FTSE 100 ex dividends to remove 0.69 index points: ()

Economic data: US unemployment claims USA, Chicago PMI of USA , UK car production, UK house prices

Headlines of the city:



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