London stocks make modest declines again on Tuesday amid the release of UK gross domestic product data that, as expected, show economic growth slowing in the third quarter. Analysts had anticipated a slowdown in UK economic growth from 0.7% in the second quarter to 0.6%, although the figures are worse, GDP actually edging just 0.5% ahead.
That weighs on investor sentiment, the FTSE 100 index easing off around 13 points, or 0.2%, to 6,404, with miners generally weak, led by the 1.5% decline to £11.145 of BHP Billiton (BLT).
In corporate news, a trading update shocker from small cap defence outfit Chemring (CHP) sees the stock plunge 33% to 151p. Failure to secure a chunky ammunition contract means the business may breach financial covenants, according to a statement today. Chief executive Michael Flowers is proposing a fully underwritten £90 million rights issue.
Oil major BP (BP.) is up 1.4% to 389.6p as third quarter numbers surprise on the upside. Profit for the three months to the end of September fell to $1.8 billion from $3 billion a year earlier, although the result was better than the $1.2 billion analysts had forecast as the group benefited from a strong contribution from its refining business.
Budget footwear purveyor Shoe Zone (SHOE:AIM) is marked up 5.4% to 194p on a reassuring pre-close trading update. The value shoe seller, which warned on profits earlier this year (21 Apr), says it traded well in the second half of the financial year and also flags significantly improved year-end net cash of £14.2 million (2014: £9.1 million).
Among the bigger movers, set-top box designer Amino Technologies (AMO:AIM) slumps 25% to 117p as it warns that it will miss full year revenue forecasts of £49.5 million. The slowdown is blamed on poor sales execution in the second half, although management state that the integration with Booxmedia is ahead of plan.
LED lighting specialist Dialight (DIA) also crashes, down 18% to 545p, as it reveals some of the findings of a strategic review. While the company remains convinced it can capture significant value in LED lighting, investors are clearly worried about the cost implications in the short-term.
In the resources space, Union Jack Oil (UJO:AIM) slumps 12% to 0.18pas it raises £800,000 gross via a share placing at 0.17p each, a 15% discount to yesterday's 0.2p close. Proceeds would allow the company to acquire interests in drill-ready projects onshore UK.
Providence Resources (PVR:AIM) also falls heavily, more than 11% lower at 21.25p, as it updates on the Spanish Point area in the northern Porcupine Basin, offshore west of Ireland. This area included the Frontier Exploration Licence (FEL) 2/04 and 4/08, in which Providence holds a 58% equity interest.
Carpets, rugs and beds retailer Carpetright (CPR) cheapens 2p to 498p, despite reporting encouraging first-half UK sales growth against tough comparatives. Disappointment surrounds the more recent trend in UK sales and guidance that UK full-year gross margins will be down by between 50 and 100 basis points.
Packaging group DS Smith (SMDS) rises 1.6% to 391.8p after saying volumes, margins, returns and earnings per share are continuing to grow despite there being no change in market conditions. The performance of its acquired businesses, which include Duropack and Lantero, has been better than originally anticipated.
Life insurer and wealth manager St James’s Place (STJ) gains 1.1% to 941p on a 20% rise in gross inflows of £2.3 billion in the three months to 30 September giving it £54.5 billion of funds under management.