UK shares tumble in early trade on Friday as concerns grow about German banking group Deutsche Bank (0H7D) and the broader financial sector. Reports on Thursday suggest numerous funds exiting Deutsche Bank, which currently faces a $14bn fine from the US Department of Justice for mis-selling mortgage-backed securities.
The knock on effects are felt right across the UK banking, and other sectors, with not a single FTSE 100 blue-chip stock trading in positive territory first thing. Lloyds (LLOY), Prudential (PRU) and Standard Charered (STAN) all feature at the top of the Footsie loser board with hefty declines, led by Barclays (BARC), down more than 4% at 160.3p.
In corporate news, Royal Bank of Scotland (RBS) unveils proposals to regroup its businesses and separate its essential banking services from investment banking, in order to comply with UK ring-fencing legislation. That news does little to lift the negative vibe, the shares sliding more than 4% to 169.8p.
Away from the financials space, TV shows and films maker Entertainment One (ETO), a bid target of ITV (ITV), sees the value of its library of content massively hiked after an independent assessment. It reports a 50% increase to $1.5bn (£1.15 bn), news that comes alongside word that its full-year performance will be in line with management expectations. The company also flags a 'strong committed film and television slate underpinning the second half of the financial year' to the end of March 2017. Read Shares exclusive web story here. The shares stay flat at 213.3p.
Defence technology company QinetiQ (QQ.) has secured a £109m, 11-year contract extension with the UK Ministry of Defence. The contract will cover Royal Navy mission systems and infrastructure through work to be carried out at the Portsdown Technology Park in Portsmouth, although the stock struggles to make headway, off 1.5% at 232.7p..
Spreadbetting firm IG Group (IGG) has agreed to buy global news and research portal DailyFX and its associated assets from FXCM in a $40m deal. The deal fails to offset wider stock market concerns, the stock slipping 8p to 857p.
Landlord Grainger (GRI) says it has agreed to forward purchase a build-to-rent development in Leeds city centre for £40m, which will deliver 250 private rented sector homes. The stock stays flat at 229.5p.
Broadcast and public safety wireless specialist Vislink (VLK:AIM) collapses as it spooks investors with a warning it expects to breach its banking covenants in September. That overshadows half year figures, with directors admitting that the firm's very survival cannot be taken for granted. Unsurprisingly, the stock is hammered, crashing more than 42% to 9.25p, valuing the business at just £12m.
Engineering and technology provider China New Energy (CNEL:AIM) rallies 5% to 1.58p as it posts a 70% hike in half year revenue and soaring gross profit.
Also surging is biotech Life Science Developments (LIFE:AIM) - up 17% at 2.5p - thanks to well-received half year results, while it's a similar story for resources minnow Xtract Resources (XTR:AIM), rallying 16% at 0.04p.
Going the other way are poorly welcomed half year figures from Independent Oil & Gas (IOG:AIM), down 32% at 18.75p, and Alecto Minerals (ALO:AIM), off 26% at 0.08p.
African agribusiness Zambeef Products' (ZAM:AIM) recovery continues, shares in the beef, pork, dairy and stock feed supplier fattening up 8.2% to 16.5p on a positive year-end trading update. Zambeef says profits for the year to September will be 'materially higher' than expected, with volumes in the core business showing strong growth and the Zambian Kwacha having remained relatively stable versus the US dollar. For more on Zambeef's improved finances and growth prospects, read our news story from August here.
