FTSE 100 edges lower but poised for best month since April

A street cleaning operative walks past the London Stock Exchange Group building in London’s financial district March 9, 2020. — Reuters pic

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LONDON, Aug 31 — London’s FTSE 100 inched lower today as banks and Bunzl outweighed gains in industrials, although solid earnings and easing fears about early tapering of central bank support kept the blue-chip index on course for its best month since April.

The FTSE 100 edged down 0.1 per cent in choppy trading, with a 1.7 per cent drop in banks outweighing a 1.3 per cent gain in industrials.

Bunzl Plc fell 1.6 per cent after the business supplies distributor flagged supply chain disruptions, product shortages and a labour crunch in certain markets including Mexico, Australia and Britain.

The domestically focussed mid-cap index climbed 0.2 per cent, hitting a record high, and was on course for its best month since December.

Asia stocks reversed earlier losses while investors stayed mostly cautious after data pointed towards fresh signs of slowdown in the Chinese economy.

“The market is reacting to data in China and that’s reinforcing the view that we’re going to get liquidity injections or cuts going forward,” said Sébastien Galy, a senior macro strategist at Nordea Asset Management.

“So, you saw a stabilisation in Chinese equity markets, rally to some extent in Asia Pacific markets, and that should translate into European markets in the next few hours.”

The FTSE 100 has gained about 10.5 per cent so far this year, but continues to lag its European and US peers as a resurgence in coronavirus cases across the world has sparked concerns of a slowdown in global economic growth.

Investors now await Markit/CIPS business activity data for August due later this week.

British Airways-owner IAG, Ryanair Holdings, Easyjet Plc and Wizz Air fell between 2.4 per cent and 3.5 per cent after European Union governments agreed on Monday to remove the United States from the EU’s safe travel list.

Among other stocks, Weir Group jumped 3.4 per cent to the top of FTSE 100 after Peel Hunt upgraded the engineering company to “buy” from “hold”.

Ferguson climbed 2.7 per cent after JP Morgan raised its price target on the plumbing and heating parts distributor. — Reuters

Source: Malay Mail

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