UK stocks started the week on the back foot with the FTSE 100 index shedding 29 points or 0.4% to 6,998 points by 8.30am, even though US markets hit a new peak on Friday, as weakness in banks offset gains for mining stocks.
US markets ended last week at record levels with the S&P 500 index rising 1% to a new high of 4,411 points and the Nasdaq 100 index gaining 1.2% to 15,112 points.
In contrast, Chinese shares hit their lowest level in seven months overnight, with H shares registering their biggest one-day fall in three years at one stage, as concern mounted over tightening regulations affecting the education and property sectors.
Oil prices also fell on fears Chinese demand for fuel would fall as the result of severe floods and a typhoon in central and eastern parts of the country. Brent crude fell 1.5% to $73.25 per barrel.
Sterling maintained its rally from recent lows, holding steady at $1.3750 ahead of a two-day Federal Reserve meeting, while gold prices recovered to $1,807 per ounce.
Meanwhile, Bitcoin surged 10% to $38,526 on a combination of short-covering and rekindled investor enthusiasm after Tesla said it might resume accepting payment in cryptocurrencies.
COMPANY NEWS
Low-cost airline Ryanair (RYA) posted increased losses for the first quarter to the end of June after most Easter travel was canceled and European restrictions were relaxed more slowly than hoped during May and June.
However, the firm pointed to a ‘strong booking recovery’ and raised its full year passenger forecast to between 90 million and 100 million. Shares climbed 2.4% to €16.10.
Cruise ship operator Carnival (CCL) announced it had re-started sailings from Seattle to Alaska over the weekend with Princess and Holland America each operating 10 cruises between now and the end of September. The firm pointed out that historically one in two visitors who cruise to Alaska use Princess or New Holland. Shares eased 1.6% to £14.21.
Meat producer Cranswick (CWK) posted a positive first quarter trading update with revenues up 9.6% in the three months to the end of June driven by a 7.7% increase in volumes as the food service industry and food to go sales recovered.
Sales to the Far East were ‘well ahead’ of the same quarter last year thanks to higher prices, while the firm is still waiting for official sign-off on its China export licence for the primary processing facility in Norfolk. Shares added 0.9% to £40.38.
Foreign & Colonial (FCIT), the world’s oldest collective investment trust, posted a total net asset value return of 12.3% in the first half to June, ahead of its FTSE All-World Index benchmark and ahead of its shares which gained 8.3% over the half.
Performance was helped by the trust’s private equity exposure, which gained 14.2%, and by its gearing which was 8.8% at the end of the half. Shares were flat at 862p.
SMALL-CAP ROUND-UP
Internet platform operator and domain name seller CentralNic (CNIC:AIM) announced a sharp uplift in second quarter earnings and lifted its guidance for the first half.
Revenues for the six months to June are now expected to rise 56% to $174 million while operating earnings are seen at $20 million, a 32% increase. Shares jumped 8% to 96.2p.
Alternative finance company Duke Royalty (DUKE:AIM) reported record cash revenues of £2.9 million for the quarter to June and forecast revenues of £3.2 million for the quarter to September, another company record.
In a busy quarter, the firm exited its investment in a UK recruitment company and entered a new royalty agreement with a European healthcare company. Shares added 4% to 41.9p.
DeepVerge (DVRG:AIM), which analyses skin samples to assess the impact of product claims by global cosmetics companies, reported strong demand for its services and a plan to increase processing capacity from its current maximum of 5,000 home test kits a month to 20,000 kits by the end of this year. Shares dipped 3.5% to 27.5p.
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