UK shares dragged lower by BAT, miners; Aston Martin skids

28 Feb, 2019

Britain's FTSE 100 fell on Thursday as results dragged on British American Tobacco, miners fell on weak Chinese factory data and Rolls-Royce slipped after dropping out the race for Boeing's mid-market aircraft.

The FTSE 100 was down 0.8 percent at 0934 GMT, falling for a third straight session and the FTSE 250 was down 0.5 percent. The index was still on track for its second monthly gain.

Investor sentiment was hit as the White House said President Donald Trump and North Korean leader Kim Jong Un did not reach an agreement at the end of two days of meetings, and as data showed factory activity in China shrank to a three-year low in February.

"I don't think this will ultimately have too much bearing on global indices in the longer term," said Markets.com analyst Neil Wilson.

"...but for now with hopes of a deal with China on trade not exactly fading, but certainly not rising, it's 0 from 2 for Trump this week and risk sentiment is suffering as a result."

Miners put the brake on the main index along with British American Tobacco, which slipped 3 percent, with Jefferies analyst Owen Bennett citing a lack of detail on its 2019 forecast and lower-than-expected full-year cigarette and new tobacco heating products volume.

Engine maker Rolls-Royce lost 3.1 percent, on track for its worst day since early December, after it withdrew from a competition to power Boeing's planned mid-market aircraft.

General insurer RSA fell 4.3 percent as high weather-related losses and weakness in commercial underwriting hit its annual operating profit.

Outperforming the main bourse was pest control firm Rentokil  that added 5 percent after higher annual earnings. The gain put the stock on course for its best day in more than one-and-a-half years.

On the midcaps, luxury British carmaker Aston Martin slumped 15 percent on track for its worst day since floating in early October after its annual adjusted pre-tax profit fell. Its Chief Executive Andy Palmer said a delay to Brexit would be a "further annoyance", which would prolong uncertainty.

Ready meals supplier Bakkavor slumped 10 percent and was on track for its worst day since its November 2017 listing. It flagged that subdued consumer confidence and inflationary pressures have continued into 2019 after reporting weaker-than-expected EBITDA.

In other moves, EasyJet, Barclays amd Micro Focus fell as the stocks traded ex-dividend while packaging and paper group Mondi dipped after a cautious 2019 forecast.

London-focused homebuilder Telford Homes tumbled 16 percent after cutting its full-year forecast and mid-cap kitchen supplier Howden Joinery lost 7 percent on track for its worst day since June 2016 after flagging higher costs and margin pressures.

Copyright Reuters, 2019
 

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