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| | London Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | London close: FTSE sinks 2.5%, extends weekly decline to 6.6% UK stocks plummeted to levels not seen in nearly two months on Friday as weak global economic data and an ongoing sell-off of crude oil hammered market sentiment. The FTSE 100 settled at just 6,300.63 by the end of trade, down an eye-watering 2.5% on the day, with just four constituents on the index finishing in positive territory. The benchmark has not closed below this level since 20 October.
Five straight days of losses have wiped 6.6% off the value of the Footsie, its worst weekly drop since September 2011.
Energy shares were faring the worst as oil prices collapsed further to their lowest levels since mid-2009. West Texas Intermediate futures dropped to below $58 a barrel, while Brent dropped to a low of $62.28.
"The rise in the supply of US crude oil has put downward pressure on prices but of greater concern is the influence of a global slowdown on demand," said analyst Jasper Lawler from CMC Markets UK. "Another forecast-cut from the International Energy Agency (IEA) for 2015 oil demand was justified by a bigger slump than expected in Chinese and Japanese factory growth."
A raft of economic data was released in China overnight. While retail sales and fixed asset investment figures were largely in line with forecasts, Chinese industrial production growth slowed more than expected from 7.7% to 7.2% year-on-year. The consensus forecast was for an annual increase of 7.5%.
The monthly increase in Eurozone industrial production also slowed down to just 0.1% in October from 0.5% the month before, missing the 0.2% estimate.
Meanwhile, UK construction output unexpectedly dropped by 2.2% over the month of October, erasing September's 2.2% gain. Analysts had expected growth to slow down to 0.7%.
Energy stocks and insurers tank
Stocks related to the oil sector such as Petrofac, Nostrum Oil & Gas, Premier Oil, Hunting, BP, Shell and Tullow Oil finished with steep losses as crude prices continued to fall.
Insurance stocks also bore the brunt of the sell-off, such as Aviva, St James's Place and Standard Life.
Oil and gas engineer Weir, however, was bouncing back after recent declines following an upgrade by Canaccord Genuity from 'hold' to 'buy'. The broker said the stock's valuation now looks "compelling" after having fallen by over a third over the past three months alone.
Utility stocks were mixed with United Utilities and Severn Trent gaining despite Ofwat's announcement that average water bills will drop by 5% by 2019-2020. However, SSE was lower after it was named as one of the three energy providers being fined a combined £4.6m by Ofgem for failing to meet environmental targets.
Meanwhile, power station group Drax was a heavy faller on the back of plans to change biomass subsidies in the UK. The stock was trading at two-year low.
Shares of telecoms giant BT were lower amid speculation that the firm will soon decide whether it wants to buy Telefonica's UK mobile network O2 or opt for Orange and Deutsche Telekom's EE. |
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| | Market Movers
techMARK 2,860.02 -1.82%
FTSE 100 6,300.63 -2.49%
FTSE 250 15,377.10 -1.83%
FTSE 100 - Risers
United Utilities Group (UU.) 903.00p +3.56%
Severn Trent (SVT) 1,937.00p +1.15%
Sainsbury (J) (SBRY) 227.50p +0.53%
Weir Group (WEIR) 1,699.00p +0.24%
FTSE 100 - Fallers
Petrofac Ltd. (PFC) 678.00p -6.35%
Coca-Cola HBC AG (CDI) (CCH) 1,256.00p -5.42%
Aviva (AV.) 468.00p -3.92%
St James's Place (STJ) 775.00p -3.79%
Standard Life (SL.) 391.60p -3.57%
Vodafone Group (VOD) 215.30p -3.43%
Schroders (SDR) 2,553.00p -3.41%
Persimmon (PSN) 1,520.00p -3.37%
Royal Dutch Shell 'B' (RDSB) 2,031.50p -3.35%
BT Group (BT.A) 397.40p -3.33%
FTSE 250 - Risers
Hochschild Mining (HOC) 91.30p +6.91%
Centamin (DI) (CEY) 52.55p +5.00%
Spirent Communications (SPT) 73.00p +2.53%
Soco International (SIA) 248.50p +2.10%
Brown (N.) Group (BWNG) 347.20p +1.97%
IP Group (IPO) 219.00p +1.86%
Card Factory (CARD) 268.50p +1.70%
Ophir Energy (OPHR) 119.20p +1.36%
Ocado Group (OCDO) 359.60p +1.18%
Dechra Pharmaceuticals (DPH) 805.00p +1.13%
FTSE 250 - Fallers
Drax Group (DRX) 508.50p -9.92%
Carillion (CLLN) 314.00p -8.72%
Nostrum Oil & Gas (NOG) 469.90p -7.68%
Premier Oil (PMO) 156.80p -7.16%
Hunting (HTG) 471.10p -7.08%
BlackRock World Mining Trust (BRWM) 295.30p -6.02%
EnQuest (ENQ) 33.82p -5.53%
Vedanta Resources (VED) 587.00p -5.17%
Mitie Group (MTO) 265.30p -4.88%
Afren (AFR) 34.44p -4.86% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks slide as oil prices drop European stocks declined amid a drop in oil prices and a slowdown in Eurozone production growth. Brent crude futures dropped 2.4% to $62.17 per barrel while West Texas Intermediate fell 3% to $58.11 after the International Energy Agency (IEA) cut its estimates for demand for the fourth time in the last five months.
IEA estimates that global oil demand will be weaker in 2015 than previously anticipated and supply from countries not part of the Organisation of the Petroleum Exporting Countries (OPEC) will be bigger.
The agency said consumption will grow by 230,000 barrels a day less than it estimated last month, while output from non-OPEC countries will grow at a quicker pace than IEA predicted in November.
It comes after OPEC cut is forecast for global oil demand in 2015.
In the euro-area, industrial production rose by 0.7% year-on-year in October, as expected, following a 0.2% increase the previous month.
"Alongside only meagre employment gain, fears over falling prices and weak take-up by banks of the European Central Bank's (ECB) cheap loan offering in December, the near-stagnant state of euro-area industry will add to calls for the central bank not hesitate in doing more to revive the economy," said Chris Williamson, chief economist at Markit.
ECB President Mario Draghi's meets with Eurozone leaders at a summit next week when he is expected to say that governments need to boost reforms.
In the UK, construction output increased 0.7% year-on-year in October, following a 2.2% increase a month earlier. Analysts had pencilled in a 1.3% rise.
Stateside, the University of Michigan's index for consumer confidence rose to 93.8 in December from 88.8 a month earlier, more than the 89.5 forecast.
Oil stocks slide
Royal Dutch Shell and Eni SpA were among the biggest fallers as oil prices declined.
BASF SE slumped after Morgan Stanley lowered its rating on the German chemical maker.
Kering SA declined after saying two top executives at Gucci will step down from the luxury label.
SSE was lower after it was named as one of the three energy providers being fined a combined £4.6m by Ofgem for failing to meet environmental targets. |
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| | US Market Report | | US open: Oil futures slide as retail receives a boost from latest figures US stocks were declining early on Friday as crude oil futures slid following the IEA's announcement that it will cut its global oil demand forecast for the fourth time in five months. At the start of trading, the Dow Jones Industrials, S&P 500 and Nasdaq were all trading in the red.
West Texas crude futures slipped below $60 a barrel late on Thursday and were dropping below $59 early on Friday.
The decline continues amid low supply levels and news earlier today that IEA will slash its global demand forecasts next year by 230,000 barrels per day to 900,000 barrels per day on the expectation of lower fuel consumption in Russia and other oil-exporting countries.
Senior US economist at Capital Economics Paul Dales said: "The latest fall in gasoline prices will weigh on overall producer prices in December and probably January too."
The retail sector was given another boost after a rise was reported in the University of Michigan measure of US consumer confidence in December to a new seven-year high of 93.8 from 88.8 in November with a consensus expectation of 89.5.
Dales noted: "Confidence is clearly being boosted by record high equity prices, the breakneck pace of job growth and the plunge in gasoline prices."
Home Depot, Microsoft, Nike, Walt Disney and Wal-mart were all rising following these positive figures in the retail sector. |
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| | Broker Tips | | Broker tips: Weir, Bellway, Spectris After the recent decline in Weir Group's shares on the back of the turmoil surrounding the oil price, the valuation of the engineering stock now looks "compelling", according to Canaccord Genuity. The broker upgraded its rating on the shares from 'hold' to 'buy', but slashed its target from 2,725p to 2,340p. The stock is now trading at a discount to others in the sector and analysts believe that "much of the potential downside is already reflected in the price".
Numis Securities has upped its forecasts for Bellway after a strong start to its fiscal year, but has downgraded its recommendation on the housebuilder from 'buy' to 'add' after the recent strong run in the shares.
The stock had gained nearly 18% in the past three months ahead of Friday's statement and the broker now sees less upside. Despite the ratings downgrade, the broker said it still believes that Bellway is "one of the most attractive housebuilders".
Investec has reiterated its 'buy' call on instrumentation and controls firm Spectris after the acquisition this week of Canadian company Engineering Seismology Group. | | |
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