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The FTSE 100 opened firmly in the red as the economic and political ramifications of the tougher Covid tiering system in the UK and continued restrictions across Europe weighed on sentiment.
“[The index] is underperforming and could well finish the week lower, as it falls back for the third day in succession, and below last week’s lows,” said Michael Hewson of CMC Markets.
“This end of week caution appears to be predicated on concern over the short-term economic outlook, as the extension of tighter restrictions on economic activity in France, Germany and the UK creates further uncertainty over the potential for permanent economic scarring as we head into 2021.
“The vaccine story is undoubtedly good news, however, there is some concern as to what the economic landscape will look like when we come out of the other side of winter.”
On the market, there was an early Black Friday blow for Marks & Spencer (LON:MKS), which fell 1.7% after Goldman Sachs downgraded the retailer from ‘buy’ to ‘neutral’. Diageo (LON:DGE) was an early modest riser after Morgan Stanley moved its call on the international drinks giant to ‘overweight’.
6.50am: Not so much Black, as Grey Friday
With no lead from the US, where the markets were closed yesterday for Thanksgiving, London’s equities look set for a directionless start.
Spread betting quotes suggest the FTSE 100 will open around 10 points lower.
“The US stock market reopens today for a half-day but volatility is likely to be quiet across the board – it is typically the case following Thanksgiving,” observed CMC’s David Madden.
In Asia on Friday, Japan’s Nikkei 225 eked out a 74 point gain at 26,611 but in Hong Kong, the Hang Seng was essentially unchanged at 26,820.
“Stocks markets in the Far East haven’t moved move as it seems that traders in that part of the world are also content to sit on the fence. Industrial profits in China surged by 28.2% last month on a year on year basis. It was the sixth consecutive month of growth and it was a big improvement on the 10.1% rise posted in the previous report,” Madden reported.
As for UK corporate news, newspaper group Reach PLC (LON:RCH) looks the pick of the scheduled updates today in London.
Peel Hunt reckons the Daily Mirror and Daily Express publisher will really have to turn it on for there to be much positive share price reaction, given that the stock has already doubled in a month after the good momentum created by the positive interims in September.
Around the markets:
- Sterling: US$1.3375, up 0.18 cents
- 10-year gilt: 0.28%, down 3.83 basis points
- Gold: US$1,807.10 an ounce, up US$1.60
- Oil: US$47.69 a barrel, down 11 cents
- Bitcoin: US$17,255, up US$133
6.45am: Early Markets – Asia/Australia
Stocks in Asia-Pacific traded mostly higher on Friday as China’s industrial profits surged 28.2% year-on-year in October, according to the country’s National Bureau of Statistics.
Chinese stocks were higher, with the Shanghai composite rising 0.32% and Hong Kong’s Hang Seng index gaining 0.14%.
In Japan, the Nikkei 225 rose 0.40% while South Korea’s Kospi gained 0.31%.
Shares in Australia skipped the trend with the S&P/ASX 200 falling 0.53%.
Proactive Australia news:
Andromeda Metals Ltd (ASX:ADN) is well-placed to transition from explorer to producer as the JV with Minotaur Exploration Ltd (ASX:MEP) is on a fast-track to start mining at the Great White Halloysite-Kaolin Project in South Australia, pending approvals.
Cirralto Ltd (ASX:CRO) has raised $2,806,200 via the issue of shares under a placement to sophisticated and professional investors at an issue price of 3 cents per share.
K2fly Ltd (ASX:K2F) chair Jenny Cutri told this week’s annual general meeting that FY20 had been an “extremely positive year for the company” despite the turbulent economic backdrop and impact of the COVID-19 pandemic.
Tempest Minerals Ltd (ASX:TEM) has completed tranche-1 of a $1.155 million placement to sophisticated and professional investors raising $744,787, which will support ongoing exploration at the company’s gold and base metal projects in Western Australia.
Technology Metals Australia Ltd (ASX:TMT) has launched a share purchase plan (SPP) which allows eligible shareholders to subscribe for up to $30,000 worth of fully paid ordinary shares without having to pay brokerage or other transaction costs.
Davenport Resources Ltd (ASX:DAV) (FRA:D86) has completed a transformational A$10 million placement, putting it in a strong financial position to advance its portfolio of four standalone projects in the South Harz region of Germany with a combined 5.3 billion tonnes of potash resource, the largest potash resource in western Europe.
Boadicea Resources Ltd (ASX:BOA) intends to expand its exploration efforts into the prolific Charters Towers gold region of north Queensland after applying for a new exploration licence for EMP27752.
eSense-Lab Ltd (ASX:ESE) is moving towards commercialising an alcohol-free sanitiser comprising two proprietary blend terpene profiles after receiving positive research results at the Central Virology Lab of the Israeli Ministry of Health.
Walkabout Resources Ltd (ASX:WKT) has executed a non-binding, conditional term sheet for a US25 million debt facility in favour of Lindi Jumbo Ltd from the African Export-Import Bank (Afreximbank).
Lotus Resources Limited (ASX:LOT) has received binding commitments to raise $5 million before costs to fund the restart study of its Kayelekera Uranium Project in Malawi and for near-mine exploration potentially increase the existing 37.5 million pounds uranium resource.
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