UK stocks drifted on Thursday as all eyes turned towards the annual meeting of US Federal Reserve bankers and a speech by chairman Jerome Powell. Sterling held firm at $1.32, close to its recent highs after its best weekly performance since June.
Brent crude oil prices hit five-month highs of $46 per barrel as hurricane Laura forced the closure of most production and refining facilities in the Gulf of Mexico.
Gold on the other hand slipped to $1,940 per ounce as investors took profits as investors booked gains ahead of the Federal Reserve meeting.
DAMAGE CONTROL AT ROLLS
The FTSE 100 index of leading stocks gave up 16 points or 0.3% to 6,029 as gains in leisure, media and mining stocks were offset by a heavy fall in shares of Rolls Royce (RR.).
The aerospace firm was the worst large-cap performer, sinking 8% to 232p after posting an underlying loss of £3.2 billion for the first half of the year due to a collapse in revenues at its civil aerospace division as the coronavirus pandemic grounded flights worldwide.
The company said it had agreed £2 billion of new funding and was preparing to sell £2 billion worth of assets including its Spanish unit ITP Aero in order to bolster its balance sheet.
STOCKS ON THE RISE
Media giant WPP (WPP) was the best performer in the FTSE, gaining 5.5% to 658p after it announced it would pay a 10p per share interim dividend despite posting a pre-tax loss of £2.58 billion for the six months to June.
Revenues were down 11.5% on a like for like basis to £5.58 billion during the period, while earnings were impacted by £2.7 billion of impairments as the firm wrote down the value of acquisitions to account for lower industry growth and the effects of Covid.
Investors were also reassured by the firm’s net cash position and the news it would report its final 2019 results by the end of next month.
Shares in betting firm Flutter Entertainment (FLTR) gained 7.5% to a new 12-month high of £135.20 after it reported a 35% increase in half-year earnings, as a jump in the number of ‘recreational customers’ entertaining themselves at home playing poker and gaming online offset a lack of sports events.
Revenues increased 49% thanks to the merger with Stars Group, while adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) reached £684 million.
Shares in building products distributor Grafton (GFTU) gained 6% to 792p despite a 61% fall in first half operating profits from continuing operations as the firm said it had seen a ‘strong recovery’ in the repair, maintenance and improvement (RMI) industry since the end of lockdown.
Recruitment firm Hays (HAS) edged up 1.7% to 119p despite posting an 11% drop in full year net fee income after a brutal final quarter to the end of June when fees fell 35%. The firm also scrapped its final dividend for the financial year just ended.
Still, investors were heartened that given the collapse in fees in the fourth quarter the firm managed to break even and that it had seen ‘modest signs of improvement’ in permanent hiring since the beginning of July.
FOR A LIST OF FTSE 100 GAINERS AND LOSERS SEE HERE