Further weakness in oil prices has served to weigh on shares in the oil sector and by default pull down the FTSE 100, 54.5 points lower at 6,718.8 early on. Any movement in Royal Dutch Shell (RDSB), down 2.5% at £22.80 and BP (BP.), off 9.1p at 499.5p, have a direct influence on the direction of the blue chip index because they are among its largest constituents. The blue chip benchmark is suffering from weakness in mining, utility and tobacco stocks, while markets in Asia and Europe are also weak.

National Grid (NG.) lacks spark, the shares reversing 3.7% to 804.7p as the power utility expresses disappointment with consultation documents published by UK regulator Ofgem and investors, many of whom hold the stock for its dividends, price in the potential for lower returns. The electricity and gas utility is particularly disappointed with regulator Ofgem’s cost of equity range, which does not appropriately reflect the level of risk borne by transmission network operators.

‘In order to deliver the major capital programme required across our networks in a rapidly changing energy market, we need to ensure the regulatory framework also provides for fair returns to shareholders and enables us to continue to deliver world class networks for consumers,’ complains National Grid.

Oil services firm Petrofac (PFC) improves 9.7p to 455.5p on the news it is trading in line full year with expectations, having won US$5bn worth of orders in the year to date. Petrofac also guides towards a reduction in year-end net debt from $0.6bn to around $250m thanks to disposal proceeds, lower capital expenditure and a working capital inflow in the second half of 2018.

‘Looking forward, we remain focused on securing new orders, delivering operational excellence and maintaining a strong balance sheet,’ says CEO Ayman Asfari. ‘We are well-positioned with a differentiated offering, good backlog and revenue visibility, and high levels of tendering for award in 2019.'

Online fast fashion retailer ASOS (ASC:AIM) cheapens another 12p to £26.02 as broker Liberum Capital downgrades the stock from ‘buy’ to ‘hold’ and slashes its price target from £80 to just £28 following yesterday’s damaging profit warning.

Investors are checking out of Irish hotel operator Dalata Hotel (DAL), trading 3.4% easier at 398.5p, despite assurances 2018’s earnings before interest, taxation, depreciation and amortisation (EBITDA) will meet market expectations thanks to a ‘very strong’ Dublin market in the second half of the year. Slower revenue per available room (RevPAR) growth at its UK hotels and heightened concerns over the impact of Brexit on the business weigh on the shares today.

Fishing tackle retailer Angling Direct (ANG:AIM) improves 5% to 86p on a positive trading update that shows the Norwich-headquartered retailer confounding the wider sector doom and gloom. CEO Darren Bailey reports in-store like-for-like sales up 7.2% to more than £4.9m in the four months to November, a record Black Friday performance and very healthy international sales growth. Bailey insists this positive momentum has continued into the Christmas trading period and remains confident his charge will meet full year expectations.

Internet of Things (IoT) enabler Telit Communications (TCM:AIM) tumbles 10.5% to 118.2p on the revelation the Financial Conduct Authority (FCA) has expanded the scope of its ongoing investigation to consider the accuracy of earlier announcements made by the previous management team led by Oozi Cats. Telit stresses the board of directors has ‘changed entirely since the events in question’ and insists it will continue to cooperate with the FCA.

Anti-microbial technology company Byotrol (BYOT:AIM) is marked down 2.7% to 1.8p despite reporting narrowed first half losses, as the company warns it expects its US division to generate a full year loss owing to administrative delays to US Environmental Protection Agency (EPA) approvals for new product variants.

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Issue Date: 18 Dec 2018