4th Mar 2019 16:56
LONDON (Alliance News) - The FTSE 100 started the week on a positive note, ending safely in the green on Monday as the pound fell following data which showed the UK construction sector shrank for the first time in 11 months in February.The FTSE 100 index closed up 27.66 points, or 0.4%, at 7,134.39. The FTSE 250 ended up 11.78 points, or 0.1%, at 19,411.43, and the AIM All-Share closed 0.53 of a point lower or 0.1% at 915.29.The Cboe UK 100 ended up 0.4% at 12,111.17, the Cboe UK 250 closed up 0.2% at 17,346.36, and the Cboe Small Companies ended flat at 11,142.47.The pound was quoted at USD1.3175 at the London equities close Monday, down from USD1.3222 at the close on Friday."The pound completed an about-face on Monday, its initial 0.4% increase against the dollar transformed into a 0.1% decline as the afternoon went on, sterling softened up by news that the UK construction sector contracted in February," said Spreadex analyst Connor Campbell.Campbell added: "This left the FTSE's early March rebound unchallenged."The latest IHS Markit/CIPS UK Construction Purchasing Managers' Index showed activity in the UK construction sector in February softened for the first time in 11 months.The PMI came in at 49.5 in February, down from 50.6 in January and slipping below the no-change mark of 50 for the first time since March 2018, when the sector had been disrupted by snow storms.A reading below 50 indicates a softening in sector activity, while one above signals expansion.Aside from the "brief" weather-related decline in output in March 2018, the latest reading marked the worst showing since September 2017, Markit said.Meanwhile, helping the broader risk-on mood in Europe were hopes that the US and China could soon reach a detente in their ongoing trade war. The Wall Street Journal reported Sunday that talks have progressed far enough that the two sides could reach a formal agreement at a potential meeting around March 27.Trade friction between China and the US is expected to occupy centre stage at China's annual parliamentary session, with a spokesman hailing "substantive progress" on negotiations on Monday, a day before the session began.US and Chinese trade teams wrapped up the latest round of negotiations last week, with the talks "intensive and productive," and achieving "substantive progress on issues of mutual interest," said Zhang Yesui, a spokesman for this year's parliamentary session, the National People's Congress.Trump agreed following the negotiations to delay raising tariffs on USD250 billion worth of Chinese imports from 10% currently to 25%. The increase had been scheduled to go into effect on March 1.In data from the eurozone, producer prices rose in January, reversing the decline registered in the last month of 2018, data from Eurostat showed.For the first month of 2019, the eurozone producer price index increased by 0.4% month-on-month, compared to a decrease of 0.8% in December. The January reading exceeded the market expectations cited by FXstreet of 0.3%.On an annual basis, in January producer prices rose by 3.0%, the same rate as reported for December and beating expectations of a 2.9% increase. The euro stood at USD1.1322 at the European equities close Monday, lower against USD1.1379 at the same time on Friday.In European equities on Monday, the CAC 40 in Paris ended up 0.4%, while the DAX 30 in Frankfurt ended down 0.1%.Stocks in New York were slightly lower at the London equities close, with the DJIA down 0.2%, the S&P 500 index flat, and the Nasdaq Composite 0.1% lower. In London, Rightmove ended among the risers to help lift the FTSE 100 on Monday, the property portal ending up 5.2% as it recovered Friday's losses. The stock closed down 2.1% on Friday despite delivering a strong annual performance with revenue and profit rising on the prior year.British Airways owner International Consolidated Airlines ended at the bottom of the blue-chips on Monday, down 4.3% after clarifying it expects lower free cash flow in 2019. In a statement to investors and analysts, IAG said it expects equity free cash flow to fall in 2019 due to operating profit being similar to 2018 and capital expenditure rising to between EUR2.60 billion and EUR2.70 billion from EUR2.20 billion in 2018.This came after IAG told an analyst call following its results on Thursday that free cash flow would rise in 2019, but subsequently issued the statement correcting that it will fall.Rolls-Royce shed 1.4% after the Financial Times reported the engine maker has reined in efforts to join a fighter jet programme being developed by Turkey.The FTSE 100-listed aerospace firm had been working with Turkish industrial company Kale Group to bid for the contract to develop the TF-X jet. The jet would have been the first locally made jet in Turkey.Rolls-Royce Chief Executive Warren East explained the firm had "substantially ramped down" its TF-X project effort and has "been re-assigning people" to other schemes.FTSE 250-listed Ted Baker gained 4.4%. Chief Executive Officer Ray Kelvin has resigned with immediate effect following allegations of misconduct made against him.Kelvin took a voluntary leave of absence from his role as CEO of Ted Baker in December last year after he was accused by the company's staff of forced "hugging" and inappropriate touching and comments. Kelvin has denied all allegations of misconduct.Since then, Ted Baker commissioned the law firm Herbert Smith Freehills LLP to investigate the allegations. It is expected that Herbert Smith Freehills will conclude its investigation at the end of the first quarter or early in the second quarter of 2019."Ray has decided that it is in the best interests of the company for him to resign so that the business can move forward under new leadership," said David Bernstein, who has become executive chair to support acting CEO Lindsay Page.Synthomer shed 7.0% despite reporting a profit rise for the fourth consecutive year.In 2018, pretax profit widened 39% to GBP120.3 million from GBP86.4 million the year prior. This was after revenue rose 9.5% to GBP1.62 billion from GBP1.48 billion in 2017. Reported profit performance was helped by a steep fall in one-off charges during 2018. Special costs fell to GBP14.8 million from GBP43.6 million the year before.Euromoney Institutional Investor fell 4.9% after Daily Mail & General Trust set out plans to return Euromoney shares to DMGT shareholders.DMGT said each of its A share holders will receive 0.19933 of a Euromoney share, plus 68.13p in cash. The company also said the number of its A shares will be reduced as part of the capital distributions, on the basis of a reduction of 0.46409 of a share for each existing A share. This comes after DMGT last week confirmed that it was considering selling its remaining 49% interest in the FTSE 250-listed business events organiser. DMGT shares closed up 4.6%.Elsewhere on the Main Market, Flybe shares dropped 20% to 1.16 pence after the struggling airline said a majority of its shareholders voted in favour of the company's acquisition by Connect Airways.At a general meeting held earlier on Monday, 63% of the airline's shareholders voted to approve the sale, with 37% against it. In February, Flybe had urged its shareholders to approve the sale valuing the firm at just 1 pence per share, or GBP2.2 million, or risk receiving "no value" for their Flybe shares.On London's junior AIM market, Abcam shares dived 18% after the antibody maker and retailer issued a lacklustre outlook despite reporting a rise in annual profit and revenue. For the six months ended December, pretax profit widened 2.7% to GBP33.7 million from GBP32.8 million the year prior. This was after revenue rose 11% to GBP124.7 million from GBP112.5 million the year before, up 10% on a constant currency basis. However, constant-currency revenue growth for the full-year is set to be "broadly in line" with the first six months. This is due to "continued softness" in Japan and phasing of revenue for its custom products & licensing business. In commodities on Monday, Brent oil was quoted at USD65.71 a barrel at the London equities close Monday, firm compared to USD65.02 late Friday.Gold was quoted at USD1,286.88 an ounce at the London equities close Monday, lower compared to USD1,303.55 at the close on Friday.In the economic calendar on Tuesday are services PMI from China at 0145 GMT, France at 0850 GMT, Germany at 0855 GMT, the eurozone at 0900 GMT, the UK at 0930 GMT and the US at 1445 GMT. Meanwhile, eurozone retail sales are at 1000 GMT, while the Redbook index in the US is at 1445 GMT and new home sales at 1500 GMT. In the UK, Kantar Worldpanel releases grocery share figures for the 12 weeks ending February 24 at 0800 GMT.In Tuesday's corporate calendar, insurer Direct Line, bookmaker GVC Holdings and safety-testing firm Intertek all release annual results, while there are third quarter figures from equipment rental firm Ashtead Group.