UK shares were lower on Friday, despite an improvement in local retail sales, as mounting cases of Covid-19 in the UK and elsewhere in Europe stoked fears of more national lockdowns.

Health secretary Matt Hancock refused to rule out a second UK national lockdown in an interview with Sky News after the Financial Times reported that government-appointed experts had suggested a two-week lockdown in October.

It overshadowed news that UK retail sales climbed 0.8% in August, though the rise was in line with market expectations.

Also weighing on markets for a second day was the banks, after the Bank of England suggested it would consider setting negative interest rates if unemployment rose sharply after the furlough scheme ended or a second wave of coronavirus damaged the UK economy.

At around 1230, the benchmark FTSE 100 index weakened 0.13% to 6,042.10.

CORPORATE NEWS

Further to the announcement on 31 July regarding its intention to sell its MTS and Borsa Italiana businesses, London Stock Exchange (LSE) said it had entered exclusive discussions with Euronext N.V. in relation to the sale of the Borsa Italiana group. The shares nudged up 1% to £89.36.

Infrastructure group John Laing (JLG) said it had agreed to sell its 30% stake in the InterCity Express programme phase-two project for up to £421 million.

In the first stage, a 15% stake would be sold generating £203.4 million while remaining the 15% stake would be sold at £203.4 million plus interest, calculated at a rate of 7% per annum, generating up to £217.6 million of income. The shares reacted positively, gaining 6% to 302p.

Fund management firm Investec (INVP) said it expected a rise in net asset value, but warned expected credit losses would remain elevated amid lower interest rates and reduced client activity.

Over the five months to 31 August 2020, third-party funds under management increased by 14.1% to £51.4b billion and the company saw positive inflows of £391 million. Following prevailing guidance from both the South African and UK regulators regarding dividend declarations, no dividend was expected. The shares fell 1.37% to 136.45p.

Printed circuit technology supplier Trackwise Designs (TWD:AIM) surged 25.5% to 144.9p, having signed a three-year manufacturing agreement potentially worth up to £38 million with a UK electric vehicle maker.

In a trading statement, designer, manufacturer and supplier of advanced testing systems to the automotive industry AB Dynamics (ABDP:AIM) said the business had been performing well with gross margins ahead of ahead of the prior year.

Revenues for the year ended 31 July 2020 are expected to be in the range of £60 million to £62 million. Having suspended the interim dividend the board said it would re-instate payment of dividends at the year-end. The shares reversed 3.2% to £18.58.

Vertically integrated skin product test services company, Integumen (SKIN:AIM) said first half revenues grew 290% to £1 million and reaffirmed guidance for full-year sales to 31 December 2020 to reach £4 million. The shares dipped 0.77% to 35.22p.

Shares in provider of cloud-based services and mobile software-as-a-service company Crimson Tide (TIDE:AIM) jumped 5.56% to 3.8p after reporting interim revenues up 40% to £1.77 million and pre-tax profits up 154% to £0.26 million.

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Issue Date: 18 Sep 2020