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Miners sink FTSE 100 as results cause big swings in Next, Aggreko, Capita

Published 01/08/2018, 06:39 pm
Updated 01/08/2018, 06:40 pm
© Reuters.  Miners sink FTSE 100 as results cause big swings in Next, Aggreko, Capita
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(For a live blog on European stocks, type LIVE/ in an Eikon news window)

* FTSE 100 down 0.8 pct

* Lloyds rises 1.7 pct after results

* Aggreko tops FTSE 250 with 11 pct rise

* Capita falls 6 pct

By Helen Reid

LONDON, Aug 1 (Reuters) - Britain's top stocks index fell on Wednesday as mining and materials shares sold off on a slide in metals prices after the Trump administration threatened further tariffs on China.

Earnings drove the lion's share of moves across the UK market, with retailer Next , power provider Aggreko, and contractor Capita among the most prominent.

Overall the FTSE 100 fell 0.8 percent by 0822 GMT, with miners the biggest weight as Rio Tinto results disappointed and copper prices fell. source said the Trump administration plans to propose slapping a 25-percent tariff on $200 billion of imported Chinese goods, having initially set levies at 10 percent. shares RIO.L tumbled 3.6 percent after first-half results missed earnings expectations. key places where the miss occurred was iron-ore and aluminium divisions - most exposed to recent cost inflation. This is likely to be the key point of discussion today," said Goldman Sachs (NYSE:GS) analysts.

High-street retailer Next NXT.L fell to the bottom of the FTSE 100, down 5.6 percent after reporting a rise in full-price sales, though it maintained sales and profit guidance. rates were better than planned, adding 4 million pounds to profit, however this was largely offset by higher warehouse and distribution costs," said Goldman Sachs analysts.

Lloyds LLOY.L was a bright spot, rising 2.1 percent after the bank's first-half profit jumped 23 percent, in line with expectations. the bank set aside another £460 million for PPI mis-selling claims, the fact that saga is coming to an end, alongside a 23% jump in pre-tax profit to £3.1 billion, kept investors onside," wrote Connor Campbell, analyst at Spreadex.

This season has been characterised by sharp reactions to earnings. Goldman Sachs analysts said results-day moves across European stocks are the biggest since they began compiling data on this in 2003.

Overall UK stocks' earnings have been strong, with commodities driving the bulk of earnings growth. A weaker sterling has also helped the exporter-heavy index.

Among mid-caps, outsourcer Capita CPI.L fell 7 percent after reporting weaker than expected free cash flow and warning the return to sales growth would take time. narrative regarding revenue momentum feels softer," said Jefferies analysts.

Aggreko AGGK.L topped the mid-caps with an 11.3 percent gain, hitting a seven-month high after the temporary power provider's first-half profit beat consensus forecasts. BBA Aviation BBA.L brought up the rear on the FTSE 250, hitting a near 18-month low after profits and margins missed forecasts. Board's confidence for only 'modest' full-year 2018 growth, plus Signature's subdued first-half EBIT progress and the slowdown noted in its market backdrop may prompt trims around 3 percent to 4 percent to consensus FY18 EPS," said Jefferies analysts.

In small-caps, funeral provider Dignity DTY.L jumped 7.4 percent to the top of the index after it announced a three-year turnaround plan and reported a rise in half-year revenue. Weaker sterling helps FTSE 100

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