LONDON MARKETS: Bank Shares Pull Back, Keeping Gain On FTSE 100 In Check
December 09 2016 - 3:47AM
Dow Jones News
By Carla Mozee, MarketWatch
Benchmark heading toward 3% weekly rise
U.K. stocks were modestly higher Friday, holding around a
five-week high, but gains on the benchmark FTSE 100 were limited as
bank shares lost ground.
The FTSE 100 was up 0.1% at 6,939.50. The benchmark on Thursday
rose 0.4%
(http://www.marketwatch.com/story/ftse-100-tilts-lower-with-investors-watching-for-ecb-decision-2016-12-08)
to 6,931.55, its highest close since Oct. 31. Thursday's rise was
the fourth in the row, the longest run of wins since late
September.
Banks stocks were lower early Friday, with Barclays PLC (BCS)
(BCS) down 1.8%, Lloyds Banking Group PLC (LLOY.LN) (LLOY.LN) off
0.9%, and Royal Bank of Scotland PLC (RBS.LN) 0.3% lower. HSBC PLC
(HSBA.LN) (HSBA.LN) was fractionally lower.
Most bank stocks rose Thursday after the European Central Bank
said it will keep buying government bonds within the eurozone
through December 2017. However, it scaled back the amount to 60
billion euros a month, starting in April. Currently, the ECB
purchases EUR80 billion in bonds a month.
European bank shares on Friday took a breather, with the Stoxx
Europe 600 Bank Index off 0.3%.
Movers: Joining the financial sector in moving lower were oil
and gas shares, and mining stocks. BP PLC (BP.LN) slipped 0.2%, and
metals producer Antofagasta PLC (ANTO.LN) fell 1%.
But advancers included Paddy Power Betfair PLC and broadcaster
Sky PLC (SKY.LN) , with those shares up 12.8% and 1.3%,
respectively.
"The FTSE was just as slow as its eurozone peers [Friday]
morning," said Connor Campbell, financial analyst at Spreadex, in a
note. However, "if a proper Santa rally is to materialize in the
next fortnight, it could well re-cross the 7,000 mark before the
year is over."
For the week, the London index is on track to rise 3%. That
would be its best week since a 2.97% increase in the week ended
Sept. 23, according to FactSet data.
The pound was buying $1.2567, down from $1.2585 late Thursday in
New York. A reading on construction output in Britain is due from
the Office for National Statistics at 9:30 a.m., or 4:30 a.m.
Eastern Time.
Retail: On Friday, Investec in a research note said the retail
industry looked set for a better Christmas season than last year's.
However, "we are cautious on 2017, expecting softer sales from
higher inflation with significant [cost of goods sold] and wage
inflation headwinds. Until there is visibility on consumer demand,
the sector is likely to underperform."
Investec said Dixons Carphone PLC (DC.LN) was its only buy
recommendation on the FTSE 100. The consumer electronics retailer's
shares rose 0.8%. Dixons will release a financial update on
Wednesday.
Investec also said it recommends selling Next PLC, Marks &
Spencer Group PLC and Kingfisher PLC. Shares of Kingfisher (KGF.LN)
were up 0.4%, M&S (MKS.LN) edged up 0.2%, and Next (NXT.LN)
rose 0.1%.
(END) Dow Jones Newswires
December 09, 2016 03:32 ET (08:32 GMT)
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