Major UK shares struggled for momentum on Tuesday as banks and airlines countered gains in miners, although solid earnings and easing fears about early tapering of central bank support kept the blue-chip index on course for its best month since April.

At 9am, the benchmark FTSE 100 was by and large flat, inching less than 10 points lower to 7,139.43. Miners gained 1.4% on higher metal prices, while banks fell 1.6%.

Asia’s main markets were mixed after China’s monthly purchasing managers’ data underwhelmed. The services side of the world’s second-largest economy contracted for the first time since February last year.

UK trading volumes are expected to remain light with many of London’s traders still on holiday.

MAJOR STOCKS ON THE MOVE

British Airways-owner International Consolidated Airlines (IAG), Ryanair (RYA), EasyJet (EZJ) and Wizz Air (WIZZ) all fell after European Union governments agreed on Monday to remove the USs from the EU’s safe travel list.

IAG topped the FTSE 100 loserboard with its stock down more than 3% at 158.18p, while Wizz was the biggest FTSE 250 faller, down nearly 3.5% at £48.16.

Autotrader (AUTO), up 1.2% at 633.8p, was well bid early on as was Melrose Industries (MRO) ahead of results later this week.

Drugs developer GlaxoSmithKline (GSK) eased 1.2% to £14.58 after beginning Phase III trials of its adjuvanted Covid-19 vaccine candidate, which will see its compared to the Oxford/AstraZeneca (AZN) Covid-19 vaccine.

Distribution business Bunzl (BNZL) saw first half revenues nudge up 6.3% at constant exchange rates to £4.87 billion. Adjusted operating profit rose 14.7% to £366.8 million.

BOARD SHAKE-UP CALL

Aero-engineer Rolls-Royce (RR.) fell 2% to 114.36p after the company’s largest investor, Causeway Capital, called on incoming chair Anita Frew to ‘refresh’ the board. Causeway Capital also wants the company to consider the future of its power systems business.

Computer services company Computercenter (CCC) rallied 2.5% to £29.56, having lifted its annual guidance, citing robust trading across all its geographies in July and August.

Computercenter said that even if it delivered a flat second-half performance, it would end the year 10% ahead of current market expectations for adjusted pre-tax profit.

SMALL CAP WRAP

Among the small-caps, Futura Medical (FUM:AIM) stood out with a 7% advance to after the group inked licensing deal for its fast-acting erectile dysfunction gel covering Brazil and Mexico.

Training solutions group Pennant International (PEN:AIM) slumped 7.5% to 30.06p as it forecast a first-half loss after its performance was hampered by contract issues with General Dynamics.

Pennant said it expected a 'significant' improvement in the second half and forecast positive operating earnings for that period.

Internet platform company CentralNic (CNIC:AIM) jumped 5.2% to 101p, having forecast full-year profit and revenue at the upper end of market expectations.

CentralNic's first-half losses had narrowed, thanks to a combination of underlying organic growth and acquisitions.

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Issue Date: 31 Aug 2021