London’s FTSE 100 capped off a losing week with a slight decline on Friday, though it avoided the heftier falls seen on the continent as French political uncertainty weighed heavily on the CAC 40 in Paris once more.

The FTSE 100 index closed down 16.81 points, 0.2%, at 8,146.86. The FTSE 250 ended down 75.59 points, 0.4%, at 20,120.36, and the AIM All-Share lost 4.39 points, 0.6%, at 776.04.

For the week, the FTSE 100 fell 1.2%, the FTSE 250 lost 2.1%, and AIM All-Share gave back 2.2%.

The Cboe UK 100 ended down 0.2% at 811.22 on Friday, the Cboe UK 250 fell 1.0% at 17,506.91, and the Cboe Small Companies dropped 1.7% to 16,453.58.

In European equities on Friday, the CAC 40 in Paris plunged 2.7%, while the DAX 40 in Frankfurt was down 1.4%.

The CAC 40, losing more than 6%, suffered its worst week since March 2022.

‘The CAC 40 has been under intense pressure,’ XTB analyst Kathleen Brooks commented.

‘The risk is that there could be more volatility as we lead up to next week’s first round of voting in the French parliamentary election. Marine Le Pen’s party are expected to get the largest amount of votes, but they may fall short of an outright majority. The risk of a win for Marine Le Pen and a shift in parliamentary power in France to the hard right is fuelling the sell-off in French stocks, and the sell-off in French banks in particular. While there might be some respite from the selling at the end of the week, we think this will be temporary, as political uncertainty may continue to weigh on sentiment.’

France’s left put up a united front on Friday, vowing a ‘total break’ with President Emmanuel Macron’s policies if it wins historic polls that could propel the far right to major gains in parliament.

Far-right figurehead Marine Le Pen, also making a pitch to voters, pledged a ‘national unity government’ if her party takes power in the snap legislative elections.

President Emmanuel Macron on Sunday stunned France by calling polls after Le Pen’s far-right National Rally scored more than double the number of votes of his centrist alliance in last week’s European elections.

In New York, the Dow Jones Industrial Average was down 0.3%, the S&P 500 was 0.2% lower, while the Nasdaq Composite was down 0.1%.

The pound was quoted at $1.2683 late in London on Friday afternoon, down compared to $1.2764 at the time of equities close on Thursday. The euro stood at $1.0698, lower against $1.0763.

Against the yen, the dollar was trading at JP¥157.36, higher compared to JP¥156.88.

The Bank of Japan on Friday said it would trim its vast hoard of government bonds as it cautiously steps away from its long-running ultra-loose monetary policy.

The central bank kept interest rates unchanged after a two-day meeting but announced plans to ‘reduce its purchase amount of JGBs thereafter to ensure that long-term interest rates would be formed more freely’.

‘A detailed plan’ for the reduction ‘during the next one to two years or so’ will be decided at the next policy meeting in July, it said.

ING analyst Chris Turner commented: ‘USD/JPY has traded higher after the BoJ failed to offer much support to the yen today. It seems many in the market are now looking for USD/JPY to push onto 160 and test whether policymakers in Tokyo are prepared to intervene again.’

In the FTSE 100, Tesco rose 2.6%.

The grocer said like-for-like sales in the 13 weeks to May 25, the financial first quarter, rose 3.4% to £15.31 billion. The UK outperformed with comparable sales up 4.6% to £11.4 billion. Booker sales fell 1.3%, Central Europe sales rose 0.6% while in the Republic of Ireland sales climbed 4.4%.

Chief Executive Ken Murphy said: ‘Following another strong quarter, we’re pleased to reiterate our guidance for the full year, with sales trends in line with our expectations and the business well-positioned for the months ahead.’

Crest Nicholson and Bellway sat either side of the FTSE 250 index, with Crest up 8.6% and Bellway down 4.4%.

Crest said it has rejected a revised all-share offer from Bellway.

On Thursday, Bellway made a new takeover proposal for Crest, but said it had been rejected.

Bellway said under the terms of the bid, Crest Nicholson investors would have stood to receive 0.093 of a Bellway share for each Crest Nicholson share. It valued Crest Nicholson shares at 253.00 pence each, the company’s equity overall at around £650.0 million.

However, after evaluating the revised proposal with financial advisers, the board of Crest rejected the offer having concluded that the offer ‘significantly undervalued’ the company and its future stand alone prospects.

Harworth Group added 2.5%. The regenerator of land and property for sustainable development and investment said it received a resolution from North Yorkshire Council’s Strategic Planning Committee granting planning permission to develop a major rail-connected industrial and logistics site.

Located at Gascoigne Interchange, a 185-acre brownfield site in Leeds, the development will create up to 1.5 million square feet of space with a gross development value of £190 million.

Brent oil was quoted at $82.51 a barrel late in London on Friday afternoon, largely unmoved against $82.53 late Thursday. Gold was quoted at $2,327.27 an ounce, higher against $2,307.79.

Monday’s economic calendar has a Chinese unemployment reading overnight.

The local corporate diary has full-year results from Monks Investment Trust.

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Issue Date: 14 Jun 2024