Major UK shares are under heavy selling pressure in early trading on Tuesday as traders dial down recent optimism, with shares of consumer firms and precious metals’ miners leading the decline, while improving employment conditions in the UK and rising US Treasury yields signalled growing bets of tighter monetary policies.
At 9.20am, the benchmark FTSE 100 is down 0.8% at 7,549.57 after the release of as-expected jobs data. UK employers added a record 184,000 staff to their payrolls in December, showing little signs of a hit from the Omicron variant, taking total staff numbers to 1.4% above their level in February 2020 before the pandemic.
Asian equities and US futures also took a hit after two-year US Treasury yields topped 1% for the first time since February 2020 as investors braced for a rate rise across the pond as soon as March.
European shares were sharply lower at the opening on Tuesday with rising bond yields putting equities under pressure as traders punted on an early rise in US interest rates.
Online retail business THG (THG) was under the cosh on Tuesday after warning that its profit margins for the year will miss analysts’ forecasts and revenue growth will slow.
The retail technology company, which floated its shares in September 2020 at 500p, said group revenue rose by 27.1% year-on-year in the fourth quarter of 2021. The board said it expects full-year revenue growth in 2022 of 22% to 25% on a constant currency basis. Management also warned of rising commodity prices affecting its nutrition division.
On the upside, oil giants BP (BP.) and Royal Dutch Shell (RDSB) rallied as oil prices surged. Brent crude futures rose around 1% to $87.41.
Just Group (JUST) gained more than 5% to 90.8p after it posted a 25% jump in full-year retirement income sales to £2.7 billion.
Alternative asset management firm Petershill Partners (PHLL) advanced 3% to 245p after saying it invested $458 million on acquisitions in the fourth quarter, which are expected to be immediately accretive to consensus earnings forecasts.
ELSEWHERE ON THE MARKET
Marshalls (MSLH) rose nearly 4% to 714p was also on the front foot as the landscaping specialist lifted full-year guidance after a strong final quarter of the last fiscal year which helped drive a 26% increase in annual revenue.
Defence technology firm Qinetiq (QQ.) rallied 3.5% to 280.2p saying that it remained on track to meet its full-year expectations after ‘strong’ progress in the third quarter.
Chemicals company Elementis (ELM) said on Tuesday that fourth-quarter adjusted operating profits were now expected to be in the range of $105 million to $107 million, modestly ahead of expectations.
The news was taken well by investors, sending the stock shooting nearly 5% up to 141p.
Recruitment minnow Gattaca (GATC:AIM) fell almost 35% to after warning on profit as recovery in its markets was coming through slower than hoped. The stock, worth 272p last summer, lost 45p to 94p.
CYBA (CYBA) shares shot up 45% to 2.4p in early deals as it confirmed it is still in discussions to buy PolySwarm. The SPAC business made the announcement after noting the recent movement of PolySwarm’s cryptocurrency token Nectar.
On 12 January 2022 Nectar was accepted for trading on the Coinbase Exchange and within two trading days had increased by 760%.