- FTSE closes 29.91 lower at 6,791.55
- Geopolitical tensions, housing data weighs
- UK Q2 GDP shows 0.8% growth
techMARK 2,799.28 -0.81%
FTSE 100 6,791.55 -0.44%
FTSE 250 15,691.81 -0.36%
UK stocks ended the final session of the week in the red as geopolitical tensions, housing data and and downgrade from the International Monetary Fund (IMF) all provided a drag to sentiment.
The losses had been limited by a sturdy gross domestic product (GDP) figure out this morning and gains amongst the banking sector, but ongoing crises in the Middle East and Ukraine were this afternoon firmly back in focus.
Dipping in the final minutes of trade, the FTSE 100 closed 29.91 points lower at 6,791.55.
The European Union today reached a preliminary agreement on economic sanctions against Russia over the Ukraine crisis. Diplomats said the details are still being worked out following discussions that lasted all day yesterday and part of today.
"Clearly businesses are suffering as a result of the weakening trade ties with Russia, which has had sanctions imposed on it by Europe and the US due to its involvement in the crisis in eastern Ukraine," said Craig Erlam, Market Analyst at Alpari UK.
UK house prices slow in July
House prices in Britain rose at the slowest pace in more than a year in July following the introduction of tougher mortgage rules, according to a Hometrack survey.
Prices climbed 0.1% this month, easing from a 0.3% increase in June, signalling a cool down in the housing market.
In other UK macro news, second quarter GDP grew at 0.8% in the second quarter as had been widely expected. The figure means the UK is now back at levels seen prior to the recession.
Lewis Sturdy, a Dealer at Capital Spreads, said: "UK GDP figure this morning proved Britain's economy has finally returned to the size it was pre market crash of 2008. With output growing by 0.8% in the second quarter, economists will be feeling pretty happy about the situation.
"Their attentions will now turn to the real wages figure, a number that Carney has stated will have to improve before interest rates go up. All is well and good having more of the population in work, but if the majority are part time or zero contract hours with a pay rise nowhere in sight, this does cause some concern. As for next week, keep an eye out for FOMC meeting as well as non-farm payrolls on Friday."
Also providing a drag today was the IMF, which lowered its forecasts for global growth from the 3.7% figure given in April to 3.4%, attributing the change to events in Ukraine and Iraq.
Over in the US, a report showed US durable goods orders rose 0.7% in June following a 1% drop a month earlier. It beat analysts' estimates for a 0.5% increase.
RBS leads risers as BSkyB sinks
RBS delivered a better-than-expected first half operating performance, but said no one at the 80% taxpayer-owned bank was "complacent about the challenges ahead".
The results, which came a week earlier than scheduled, showed operating profit totalled £2.6bn, or £3.3bn excluding restructuring and litigation and conduct costs, compared with £1.59bn in the same period a year earlier. The gains were driven by more favourable credit conditions and good results from RBS Capital Resolution, and came despite a 6% decline in total income to £9.9bn.
Barclays and Lloyds Banking Group were also higher on the news.
Anglo American shares
were higher on the back of its Chief Executive's confidence in the group's outlook.
Pearson shares climbed despite the publishing group posting a fall in first half profit. It did, however, maintain its full-year profit forecasts, which may have come as a relief to some investors after a series of downbeat trading statements in recent times.
Vodafone moved higher after the decline in its service revenue was lower than had been expected after the losses in Europe were partly offset by gains in African and India.
Sainsbury rose after market sources yesterday suggested Qataris is poised to make another bid for the supermarket chain at 500p or more per share.
Meanwhile, BSkyB was firmly in the bottom spot after it failed to impress with its decision to buy the entire stake of Sky Italia and a 57.4% interest in Sky Deutschland from Rupert Murdoch's 21st Century Fox. The group will pay £2.45bn for Sky Italia and £2.9bn for Sky Deutschland. The news overshadowed its annual results, in which it posted a 7% rise in adjusted revenue to £7.6bn.
GlaxoSmithKline continued to fall one day after lowering its outlook after second quarter profits declined 12%. UBS reduced its target price from 1,500p to 1,380p and downgraded the stock from neutral to sell.
FTSE 100 - Risers
Royal Bank of Scotland Group (RBS) 364.20p +10.77%
Anglo American (AAL) 1,639.50p +3.44%
Pearson (PSON) 1,132.00p +2.82%
Vodafone Group (VOD) 202.05p +2.12%
Barclays (BARC) 218.05p +1.66%
Tullow Oil (TLW) 764.00p +1.19%
Lloyds Banking Group (LLOY) 74.81p +1.16%
Sainsbury (J) (SBRY) 320.20p +1.01%
Randgold Resources Ltd. (RRS) 5,115.00p +0.99%
Rolls-Royce Holdings (RR.) 1,053.00p +0.67%
FTSE 100 - Fallers
British Sky Broadcasting Group (BSY) 874.50p -5.46%
GlaxoSmithKline (GSK) 1,423.00p -3.16%
Petrofac Ltd. (PFC) 1,127.00p -2.17%
Rexam (REX) 513.00p -2.01%
GKN (GKN) 344.20p -1.99%
Persimmon (PSN) 1,280.00p -1.99%
British Land Co (BLND) 717.00p -1.92%
Barratt Developments (BDEV) 364.30p -1.83%
Admiral Group (ADM) 1,481.00p -1.73%
Tesco (TSCO) 270.35p -1.62%
FTSE 250 - Risers
Balfour Beatty (BBY) 253.10p +9.05%
Carillion (CLLN) 362.80p +7.18%
Countrywide (CWD) 489.20p +5.18%
Lonmin (LMI) 241.00p +4.92%
Interserve (IRV) 648.00p +2.86%
Renishaw (RSW) 1,899.00p +2.76%
Just Retirement Group (JRG) 144.90p +2.40%
African Barrick Gold (ABG) 259.80p +2.28%
Regus (RGU) 180.10p +1.98%
Cineworld Group (CINE) 329.40p +1.89%
FTSE 250 - Fallers
Spectris (SXS) 1,934.00p -7.69%
Howden Joinery Group (HWDN) 347.50p -4.77%
Cairn Energy (CNE) 177.30p -3.69%
AO World (AO.) 212.10p -3.24%
Kazakhmys (KAZ) 343.00p -3.11%
Electrocomponents (ECM) 234.80p -2.65%
Vesuvius (VSVS) 459.40p -2.59%
BTG (BTG) 606.00p -2.57%
Catlin Group Ltd. (CGL) 524.00p -2.06%
Imagination Technologies Group (IMG) 196.60p -2.04%