Concerns of an earlier than expected end to the US Federal Reserve’s ultra loose monetary policy continued to weigh on global equity markets during lunchtime trading on Thursday. At 12.30pm, the benchmark FTSE 100 was trading 2% lower at 7024.24.
A fragile UK equity market mood was compounded by weakness in commodity prices, coupled with continued fears surrounding the further economic damage inflicted by the delta variant on global economies and the geopolitical fallout from the Taliban’s return to power in Afghanistan.
MAJOR STOCKS ON THE MOVE
Copper and gold producer Antofagasta (ANTO) reported strong trading for the first half with sales up 68% to $3.6 billion and EBITDA up 133% to $2.4 billion thanks to record copper prices and high levels of demand.
However, a continued drought in Chile meant the company lowered its full year copper output target, while keeping its cost guidance. Combined with an overnight fall in metals prices, this was enough to send shares down 4.2% to £14.08 at midday.
FTSE 250 landscaping products maker Marshalls (MSLH) posted a sharp increase in sales and earnings for the six months to June compared with last year and said it was raising its guidance for this year and next year, sending shares up 2% to 775p.
‘Trading continues to improve, and recent order intake has been good. Encouraged by the continuing strength in demand and the positive trading environment, the board is confident of making further progress and is accordingly raising its expectations for 2021 and 2022,’ said chief executive Martyn Coffey.
Shares in banking firm OSB (OSB) topped the FTSE 250, rising 4% to 510 in midday trading after the bank reported a 62% increase in first half pre-tax profits to a record £253 million thanks to the release of bad loan provisions and lower funding costs.
The underlying net loan book grew by 6% to £20.3 billion with £2.5 billion of new lending in the first half, while in contrast to the rest of the industry the bank raised its net interest margin to 2.68% from 2.5% in the same period last year.
ELSEWHERE ON THE MARKET
Shares in bingo and casino operator Rank (RNK) fell 2.5% to 178P in midday trading after the group announced results for the 12 months to June 21. The results revealed the full extent of the damage inflicted by the Covid 19 pandemic, and the associated social restrictions on the company’s profitability.
Rank reported an underlying profit loss of £67 million versus a profit of £48 million in the prior year. Revenues declined by 50%, and the underlying loss per share was 20.3p, compared to positive earnings per share of 6.7p in the pervious year. This marked deterioration is a direct result of both its Mecca bingo and Grosvenor casino franchises being closed during the pandemic.
White-label household goods and cleaning products firm McBride (MCB) delivered a major downgrade to its earnings outlook just seven weeks into the current financial year.
The firm is now forecasting pre-tax profits for the year to next June between 55% and 65% lower than last year due to supply chain disruption and an inability to pass on higher raw material and transport costs to its customers.
Shares slumped 8.5% to 77.6 pence in midday trading.
Iron foundry and machining group Castings (CGS) reported a slowdown in orders from commercial truck-makers, which comprise 70% of its customer base, due to supply chain issues.
The firm said sales were ‘particularly impacted in the last two weeks of June’ and order delays had continued into the second quarter. It said it was maintaining high production levels in order to build inventory ahead of an anticipated increase in demand. At midday shares were trading 4.7% lower at 369.5p.
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