Member access

4-Traders Homepage  >  News

News

Latest NewsCompaniesMarketsEconomy & ForexCommoditiesHot NewsMost Read NewsRecomm.Business LeadersVideosCalendar 

FTSE knocked off highs as tension grows in Ukraine

04/25/2014 | 11:46am US/Eastern
Recommend:
1

Britain's top share index slipped on Friday from its seven-week closing high the day before, as growing tension in Ukraine offset encouraging updates from media group Pearson and betting agency William Hill.

Pearson rose 3.8 percent after saying it had made a "solid" start to the year. William Hill gained 2.1 percent after its first-quarter results. The two companies were the top gainers on the FTSE 100 index.

But the index ended 0.3 percent lower at 6,685.69 points, after its highest close since March 7 on Thursday, following an escalation in tensions in Ukraine and the prospect of more sanctions against Russia.

The Ukraine government opened further military operations against some of the pro-Russian separatists who have seized government buildings in eastern Ukraine. As many as five of the separatists were killed on Thursday.

"Clearly, the market remains sensitive to geopolitical tensions, and that's getting reflected in the weak performance today," HSBC equity strategist Robert Parkes said, although he remained positive on the market's longer-term outlook.

"Even though the market is facing a number of headwinds, including the Fed's stimulus-tapering programme and concerns regarding emerging-market growth, we think the stock market is well-supported."

Parkes said monetary policy could ease further in Europe and

the business cycle was heading up. Ultimately, earnings growth would accelerate.

Cyclical stocks were the worst hit on Friday, with HSBC falling 1.7 percent and Standard Chartered down 1.6 percent. The UK banking index dropped 1.3 percent, the biggest sectoral decliner on the FTSE 100 index.

Despite Friday's losses, the UK stock market outperformed the rest of the Europe, with the pan-European FTSEurofirst 300 index down 0.8 percent, Germany's DAX falling 1.5 percent and Italy's FTSE MIB down 1.7 percent.

UK blue chips get only 0.3 percent of their sales in eastern Europe, Thomson Reuters Datastream shows. But the prospect of more sanctions and strained ties between Russia and Western powers curbed appetites for shares across Europe.

"Fresh tensions in Ukraine have darkened investors' mood, and there are concerns about further sanctions against Russia. People are also worried about possible military conflict between Russia and Ukraine, which is not priced in at all," said Keith Bowman, equity analyst at Hargreaves Lansdown.

U.S. President Barack Obama will press European allies to impose more sanctions if Russia steps up action in Ukraine Meanwhile, a cut in Russia's credit rating reminded Moscow of the economic consequences of its involvement in the crisis.

LOSSES CAPPED

Losses in the broader market were capped by a rise in shares of individual companies.

Investors reacted positively to updates from William Hill and Pearson, while Berenberg's move to raise its price target for luxury goods company Burberry to 1,550 pence from 1,500 pence helped its shares to gain 0.8 percent.

Analysts at Citi said Pearson's underlying revenue growth of 1 percent beat its forecast of a 3-5 percent drop, while some other analysts highlighted William Hill's encouraging numbers in overseas and online markets despite weak results at its football business and regulatory headwinds in Britain.

"We retain our 'buy' recommendation given the strong position of William Hill in the online gambling space, with potential to see further significant revenue growth, whilst the valuation remains undemanding," analysts at Panmure Gordon said in a note.

(Additional reporting by Francesco Canepa; Editing by Larry King)

By Atul Prakash

Recommend :
1
React to this article
Latest news
Date Title
2m ago YOUGOV : EFE News Briefs for Thursday, Sept. 18
4m ago Apple's new iPhone models go on sale in Japan
4m ago Lockheed eyes 2-4 percent cost reduction in next F-35 contract
6m ago MOBIL'NYE TELESISTEMY : Universal Mobile System receives 2.5m numbers
6m ago MOBIL'NYE TELESISTEMY : MTS: Arrest of Yevtushenko not to impact MTS plans in Uzbekistan
6m ago MASTERCARD : Diarise 'Magic of Bubbles' in Franschhoek
6m ago WESTERN UNION : Angola Post Office partner for money transfer services
6m ago YUM BRANDS : I LAaik it local
6m ago ANALYTIXINSIGHT : Samsung Gear Deal Takes MarketWall App to New Heights
7m ago Introducing Blok - the new brand on the property (ahem) block
Latest news
Advertisement
Hot News 
DIXONS CARPHONE : Phones 4u buyers still sought, but 800 jobs safe
GAME DIGITAL : Proposed Placing
Ahead of the Bell: Pier 1 Imports (Ahead of Bell)
MSCI : Yes bank dropped from msci standard & mid-cap indices
TOUR EIFFEL : Société de la Tour Eiffel finalised the acquisition of an 8,300 m² office building in Bagneux (Paris inner rim) and pursues its refocusing
Most Read News
54m ago Alibaba IPO prices at top of range, raising $21.8 billion
26m ago HOME DEPOT : breach bigger than Target at 56 million cards
1h ago INTEL : Tapping the growing tablet market
40m ago Oracle's Ellison steps aside, co-CEOs Catz and Hurd take over
1h ago NEW HOME : Theatre Romeo and Juliet Victoria Baths, Manchester 32/40: Folk Joan Baez Royal Festival Hall, London 32/40
Most recommended articles
4m ago Lockheed eyes 2-4 percent cost reduction in next F-35 contract
16m ago Most Japan firms would prefer the yen at stronger levels
24m ago Three quarters of Japanese firms prefer a stronger yen
25m ago Argentina, Citigroup face tough questioning in bond appeal
26m ago HOME DEPOT : breach bigger than Target at 56 million cards
Dynamic quotes  
ON
| OFF