UK stocks ended the month and the quarter in negative territory, despite positive economic data and a revival across the mining sector, a major contributor to the leading FTSE 100 index, with Anglo American’s (AAL) 3% gain topping the leader board.
At the close the benchmark FTSE 100 was down 22 points or 0.3% at 7,086 points, with gains in miners and drug maker AstraZeneca (AZN) - up 1.4% after its Covid vaccine performed well in US trials - offset by losses in hospitality, leisure and travel stocks.
‘STRONG’ START FOR DIAGEO
Drinks giant Diageo (DGE) gained 1.2% to £36.06 after the company made a ‘strong’ start to fiscal 2022, with organic net sale momentum across all regions. European business is recovering ahead of company expectations.
But the expectation that organic operating margins stand to benefit from a further recovery in sales volumes, positive channel mix and premiumisation trends got investors excited.
Online fashion brand Boohoo (BOO:AIM) disappointed investors on the other hand, slumping 15% to 217p after dampening profit margin expansion hopes through the rest of the year.
First-half sales rose 20% to £975.9 million while gross profit rose similarly to £533.3 million, but elevated short-term cost headwinds experienced in the first half are expected to continue in the second six months.
That means that despite an expectation for full year sales growth of 20% to 25%, adjusted earnings before interest, tax, depreciation and amortisation margins are now expected to be 9% to 9.5%, compared to 9.5% to 10% as previously guided.
British American Tobacco (BATS) was a big FTSE loser as one of a handful of major stocks to go ex-dividend (where new investors lose the rights to the next dividend), as is the usual Thursday practice. BAT saw its share price fall 4.5% to £26.12.
Also in this category were housebuilder Barratt Developments (BDEV), down 1.5% to 660p, and medical products group Smith & Nephew (SN.), 1.9% lower at £13.15..
SPEEDY GROCERCIES HEAT UP
Food delivery platform Deliveroo (ROO) and soon to go private Morrisons (MRW) announced the launch of Hop, a rapid grocery delivery service that promises to increase competition on this growing market.
Deliveroo stock eased 1.4% to 289p, with investors still cautious over the firm’s ability to turn revenue growth into profits.
Investors were all over shares of biotech Oxford Nanopore Technologies (ONT) sending them soaring within minutes of their market debut on Thursday, indicating huge interest in life sciences companies listing in London.
The stock closed at 612p, having floated at 425p, handing institutional investors a 44% first day gain.
Also enjoying a strong start to trading was digital business Made Tech (MTEC), which opened at 130p and rallied to 142p from an issue price of 122p, for a first day gain of 16%.
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