Oil price rises on Ida | business confidence lifts
REFRESH PAGE FOR UPDATES
10pm: Wall Street slips lower
Wall Street stocks closed slightly lower although August was the seventh consecutive winning month for the S&P 500 which closed 0.13% weaker.
The Dow Jones Industrial Average was down 0.11% and the Nasdaq Composite closed 0.04% softer.
In corporate news, Zoom shares plunged almost 17% after revealing that second-quarter revenues had slowed despite raising guidance and beating on earnings as a result of the worsening Covid-19 pandemic.
5pm: Blue chips lower
The FTSE 100 index spent most of the day under water and closed 28.31 points lower at 7,119.70.
9.30am: Markets hit by travel uncertainty
Early exchanges after the market opening included some weakness in the banks and also airline and related stocks, given the ongoing uncertainties around a full resumption of international travel, said Richard Hunter of Interactive Investor.
“Nonetheless UK markets also remain in positive territory in the year to date, albeit at more sedate levels of growth than their US counterparts, with the FTSE 100 ahead by 10.8% and the FTSE 250 by 17.4%,” he said.
Computacenter gained on expectations of that annual adjusted profit will be ahead of market views. In an unscheduled trading statement, the IT group said its performance has continued to be robust across all of its regions in July and August.
Newspaper group Reach, owner of the Daily Record and Express titles, was a high riser after an initiation at ‘buy’ at Liberum, which said the company is approaching an inflection point where digital could offset print faster than consensus is expecting.
Travel stocks retreated after the EU recommended a pause on all non-essential travel from the US due to rising Covid cases. British Airways and Iberia parent IAG and budget airlines Wizz Air and easyJet were all weaker.
HSBC, NatWest, Barclays and Lloyds were also trading lower.
The FTSE 100 was 7points lower at 7,140.89.
7am: Property portfolio acquired
Glasgow-based London and Scottish Property Investment Management (LSPIM) has acquired a £236 million portfolio of predominantly multi-let regional offices from Squarestone Growth.
Oil lifted by hurricane
Oil prices rose sharply as Hurricane Ida weakened and Opec+ looked set to go ahead with a planned output increase.
Brent Crude was up 0.7% at $73.18 a barrel in evening trading, having hit an intra-day high of $73.68, its highest since 2 August. Brent has rallied 40% this year.
Hurricane Ida has forced the closure of oil production in the Gulf of Mexico, although the weakening of the storm led to hopes that production could resume more quickly than had been feared.
London was expected to open lower after Asia’s main markets were unsettled by weak purchasing managers’ data in China.
While the manufacturing sector is expanding, services contracted for the first time in more than 18 months.
The Shanghai Composite fell 0.32% and Hong Kong’s Hang Seng index was 0.69% lower.
However, in Japan the Nikkei 225 rose 1.15% while South Korea’s Kospi rose 1.00%.
Business confidence in Scotland rose six points during August to 34% as the full easing of lockdown restrictions in Scotland lifted overall confidence in the economy by 20 points to 43%.
The latest Business Barometer from Lloyds Bank / Bank of Scotland Commercial Banking showed a net balance of 20% of businesses in Scotland expect to increase staff levels over the next year, up seven points on last month.
Overall UK business confidence rose six points in August, reaching 36%, the highest level recorded since May 2018. When asked about their overall trading prospects businesses reported a six-point increase on July’s reading at 34% and firms’ confidence in the economy also increased six points to 39%.
All UK nations and regions had a positive confidence reading in August. The most confident regions were the North West (64%), North East (46%) and London (41%). All bar three areas reported a growth in confidence in August, with the East Midlands (down 10 points to 28%), West Midlands (down three points to 27%) and Yorkshire and Humber (down two points to 26%) reporting marginal falls.
Hann-Ju Ho, Senior Economist Lloyds Bank Commercial Banking, said: “Business confidence reaching its highest level in over four years tells a positive story about the country’s economic recovery. This confidence is driven by the continued success of the vaccine rollout, the removal of lockdown restrictions and adjustments to self-isolation rules.
“Staff shortages remain a challenge, but as the economy moves back towards pre-pandemic levels we can be optimistic that the momentum for business confidence and economic optimism can be sustained in the months ahead.”