Weak economic data from China and the Eurozone and hawkish Federal Reserve minutes push UK stock markets lower in early trade Thursday, continuing the weak trend yesterday. London's FTSE 100 index trades down 0.6%, or 40 points, at 6,657 in early deals, with mining stock Fresnillo (FRES), BHP Billiton (BLT), Anglo American (AAL) and Rio Tinto (RIO) weighing heavily.
British Gas-owner Centrica (CNA) is also off after warning that full year and 2015 earnings will be lower than previously guided due to 'a number of challenges,' including low oil and gas prices, cold weather in the US, warm weather in the UK and boiler inspections at its power stations. That sparks the energy group to modestly lower its full year earnings per share range of 19p to 20p, from the previous 21p to 22p guidance issued in July. But the market largely shrugs off the downgrade, the shares edging just 1% lower to 295.2p.
On the rise is chemicals sector bellwether Johnson Matthey (JMAT), adding 2.9% to £32.43p, as half year results show modestly improving profits. The £6.5 billion group also ups guidance for the full year.
Diverging fortunes among UK government outsourcers sees defence and marine contractor Babcock International (BAB) near the top of the FTSE leaderboard and Serco (SRP) close to the bottom. Babcock rises 4.4% to £11.67 as it reports improving cash generation has helped deleverage its balance sheet. In a statement for the six months to end of September, basic earnings per share increased 11% and profit before tax rose 32% on the prior year.
Process outsourcer Serco (SRP) slides 2.8% to 187p as investors continue to sell down the stock ahead of a prospective rights issue in the first quarter of 2015. Yesterday Swiss investment bank UBS sold down its stake below the 3% notifiable threshold.
The Financial Conduct Authority and the Bank of England have fined Royal Bank of Scotland (RBS) £56 million for the computer failures that hit more than 6.5 million UK customers for several weeks in 2012. RBS shares remain largely flat, however, off just 0.3% to 382.8p.
Among AIM stocks, controversy hit insurance claims outsourcer Quindell (QPP:AIM) is thrust back in to the news as market rumours prompt the company to quash talk that it is looking to sell its stake in car repairs business Nationwide Accident Repair Services (NARS:AIM). 'Contrary to speculation, Quindell is not actively seeking to sell its shares,' the company states, just days after founder, chairman and major shareholder Rob Terry was forced off the board following a controversial share trade and the resignation of joint broker CanaccordGenuity.
Fresh from a £100 million rights issue, mother and baby products purveyor Mothercare (MTC) is marked up 3.75% to 179.75p as interims show improvement signs. CEO Mark Newton-Jones reports 1.5% growth in UK like-for-like sales, a modest reduction in losses in the troubled domestic business, as well as a 65% group-level surge in underlying taxable profits to £3.3 million.
Troubled coal miner Asia Resource Minerals (ARMS) falls 4.4% to 22p as it appoints a financial adviser and warns it may have to issue new stock to help repay $450 million worth of bonds due in July 2015. That's more than five times the present value of the business.
Mobile enterprise platform supplier Globo (GBO:AIM) jumps 6.5% to 45..25p as it posts strong third quarter growth and free cash generation, despite splashing $12 million on the Sourcebits acquisition. Expansion in the US will be critical to future progress, say analyst at IT consultancy Megabuyte.
Investors come running to cloud business optimisation play Outsourcery (OUT:AIM) as it claims a spot among supplier of Microsoft's (MSFT:NDQ) Cloud Solution Provider Program to resell and bill Office 365. Shares in the company have collapsed this year from peaks of 120p as multiple cash calls and questions over growth spooked investors. The company IPO'd in May 2013 at 110p, but the stock rockets 73% on today's news, albeit from a battered 10.25p level.
Oil explorer Tangiers Petroleum (TPET:AIM) shoots up 45.6% to 0.77p as it seeks to put its unsuccessful exploration push in Morocco behind it by successfully bidding for acreage in Alaska. It will be partnered on Project Icewine with Burgundy Xploration, which was the bid agent for the property, and will be carried on the first $2 million spent on the property.