- FTSE closes down 53.45 points at 6,733.62
- Iraq, US GDP provide drag
- Meggitt leads losses after broker downgrade
techMARK 2,789.11 -0.71%
FTSE 100 6,733.62 -0.79%
FTSE 250 15,453.95 -0.60%
Continued concerns about the situation in Iraq, a worse the expected drop in US first quarter GDP and a broker downgrade for Meggitt all led to heavy losses on the FTSE 100 today, which at one point dropped to its lowest level since April.
The main index ultimately closed down 53.45 points at 6,733.62.
US GDP was revised sharply lower to a 2.9% contraction, marking its biggest decline since 2009, which, as CMC Market Analyst Jasper Lawler warned, has the potential to derail the Fed's tapering programme.
He explained: "From the start, the Fed has said the reduction in asset purchases is data-dependent; this data is pretty bad so what else do they need? Next Thursday's (Friday is Independence Day) unemployment data will be even more important for the next Fed policy meeting. A drop below 200k jobs created might be all it takes for a taper of the taper."
That came as the GfK consumer confidence indicator for Germany resumed its upward trend and beat consensus with a revised reading of 8.9, beating consensus forecasts for an unchanged reading of 8.5.
Analysts at Berenberg said the number reflected very positive fundamentals for German consumption.
"Plenty of jobs, rising wages, fading uncertainty and low inflation should help sustain consumption as a robust driver of German domestic demand and thus also of Eurozone growth," the broker said in a note on the data.
Iraqi PM ignores calls for "national salvation" government
In the latest from Iraq, Prime Minister Nouri Maliki has reportedly decided against the suggestion put forward by the US government to establish an emergency "national salvation" government in an attempt to respond effectively to the rebels which have seized regions of the country at a rapid pace.
Although he took the opportunity of his weekly televised address to the nation to request that "all political forces [...] reconcile" in an effort to fight what he described as the "fierce terrorist onslaught", he gave no signal that he would offer the Sunni Arab community a higher level of representation.
Back in the UK, the CBI Distributive Trades Survey showed the balance of retailers that reported sales were up year-on-year crashed to a seven-month low of +4% in June from +16% in May and +30% in April.
The CBI said a fall in clothing and food sales contributed to a disappointing month on the high street, and cautioned that slow wage growth continued to weigh on consumer sentiment.
Economist Howard Archer of IHS believes there could be wider implications from the retail data update.
"With Mark Carney stressing that the Bank of England's decision on when to start raising interest rates will be data driven, the loss of momentum in retail sales reported by the CBI is likely to dampen expectations of any action before the end of 2014," he said.
In other macro news, HSBC has said it sees the Monetary Policy Committee increasing the Bank Rate for the first time in February 2015, rather than in the third quarter of 2015.
Shire leads after Abbvie refuses to confirm or deny bid rumours
Bid target Shire was propelled higher after Abbvie refused to confirm or deny it was planning to put in an offer for the drugs company. It also received a boost from the US courts, which blocked competitors from selling generic versions of its Vyvanse branded drug for attention-deficit hyperactivity disorder (ADHD).
Ashtead Group rose after HSBC reiterated its 'overweight' rating on the stock.
Meanwhile, a downgrade from JP Morgan prompted a steep drop in Meggitt shares.
FTSE 100 - Risers
Shire Plc (SHP) 4,517.00p +2.57%
Ashtead Group (AHT) 841.50p +1.75%
TUI Travel (TT.) 388.30p +1.36%
Rolls-Royce Holdings (RR.) 1,045.00p +1.26%
St James's Place (STJ) 749.50p +1.08%
Friends Life Group Limited (FLG) 307.00p +0.99%
Hammerson (HMSO) 572.00p +0.70%
Burberry Group (BRBY) 1,465.00p +0.62%
InterContinental Hotels Group (IHG) 2,377.00p +0.51%
British Land Co (BLND) 690.00p +0.44%
FTSE 100 - Fallers
Meggitt (MGGT) 508.50p -3.23%
Tullow Oil (TLW) 846.50p -2.81%
Coca-Cola HBC AG (CDI) (CCH) 1,332.00p -2.63%
ARM Holdings (ARM) 886.00p -2.42%
Experian (EXPN) 968.50p -2.22%
Carnival (CCL) 2,227.00p -2.15%
Antofagasta (ANTO) 762.50p -2.12%
Kingfisher (KGF) 357.00p -2.11%
Anglo American (AAL) 1,427.50p -2.02%
Petrofac Ltd. (PFC) 1,199.00p -1.96%
FTSE 250 - Risers
Rank Group (RNK) 171.80p +4.12%
Xaar (XAR) 522.00p +3.16%
NMC Health (NMC) 459.50p +3.12%
Home Retail Group (HOME) 175.60p +2.09%
Alent (ALNT) 352.50p +1.88%
Northgate (NTG) 510.00p +1.69%
Bellway (BWY) 1,493.00p +1.63%
BH Global Ltd. USD Shares (BHGU) 11.89 +1.62%
Daejan Holdings (DJAN) 4,840.00p +1.57%
Euromoney Institutional Investor (ERM) 1,125.00p +1.44%
FTSE 250 - Fallers
Imagination Technologies Group (IMG) 236.80p -5.84%
Perform Group (PER) 248.80p -4.86%
Ocado Group (OCDO) 350.00p -4.58%
Premier Oil (PMO) 322.10p -4.11%
Tate & Lyle (TATE) 658.00p -3.94%
Croda International (CRDA) 2,106.00p -3.75%
Elementis (ELM) 264.00p -3.72%
Spirax-Sarco Engineering (SPX) 2,688.00p -3.38%
Regus (RGU) 180.70p -3.37%
Vedanta Resources (VED) 1,110.00p -3.31%
FTSE TechMARK - Risers
Oxford Biomedica (OXB) 2.80p +2.75%
Optos (OPTS) 184.50p +2.36%
Gresham Computing (GHT) 132.75p +2.12%
SDL (SDL) 328.50p +2.02%
Filtronic (FTC) 26.50p +0.95%
Sepura (SEPU) 149.75p +0.50%
Promethean World (PRW) 32.12p +0.39%
Gov Bond 7-10YR UCITS ETF (IEGM) € 191.06 +0.34%
NCC Group (NCC) 185.00p +0.27%
Anite (AIE) 92.00p +0.27%
FTSE TechMARK - Fallers
Torotrak (TRK) 18.75p -10.18%
Triad Group (TRD) 10.00p -4.76%
E2V Technologies (E2V) 164.00p -2.38%
Skyepharma (SKP) 247.75p -2.27%
XP Power Ltd. (DI) (XPP) 1,440.00p -1.57%
Dialight (DIA) 873.00p -1.36%
RM (RM.) 163.50p -1.21%
Ricardo (RCDO) 628.50p -0.95%
Consort Medical (CSRT) 962.50p -0.77%
Innovation Group (TIG) 33.25p -0.75%