26th Nov 2013 11:09
LONDON (Alliance News) - UK stocks are trading mixed Tuesday, with London's large-cap index sliding lower along with global peers, while mid-cap UK stocks are buoyed by strong results.
Meanwhile, the oil price has made a complete turnaround from the sell-off sparked by a weekend deal over Iran's nuclear capabilities.
By mid-morning Tuesday the FTSE 100 is down 0.4% at 6,875.62, the FTSE 250 is up 0.2% at 15,327.19, and the AIM All-Share is up 0.1% at 818.99.
Following a close-to-flat close in the US, Asian stocks also have shown a lack of strength. The Hang Seng main index closed roughly flat and the Nikkei down 0.7%. The lower close in the Japanese market comes despite and an index of small-business confidence rising to 51.1 in November, from 50.8 a month ago.
Equities traders paid more attention to the Bank of Japan's board minutes from its last meeting, which were less upbeat than expected. The minutes highlighted "revealing tensions and difficulties in meeting the 2% inflation target, undoubtedly the main goal of the BoJ?s QE policy undertaken since April", said Spreadex trader Alex Conroy.
The price of oil has retraced all of the large losses seen on Monday following the weekend announcement of a deal between six western powers and Iran. Brent fell to a low of USD108.03 per barrel on Monday, but by mid-morning Tuesday is back up to USD111.15 per barrel. "If you spent yesterday in bed, ignoring the market reaction to the Iranian sanctions-lifting deal, you made the right choice", said Societe Generale Senior Strategist Kit Juckes.
The global equities rally that followed Monday's oil price drop has been stopped in its tracks. Major European markets are also lower, the CAC40 down 0.4% and the DAX down 0.1%.
Within UK equities, the mid cap FTSE 250 index is outperforming its big brother, reacting less to macro economic events and more to company fundamentals.
Currency printing company De La Rue leads the way, up 10%, after reporting rising pretax profits. De La Rue posted a pretax profit of GBP28.4 million, up from GBP23.8 million in the previous year, benefiting from savings of GBP10 million realised during the period through its cost reduction programme.
Mitchells & Butlers is up 6.0% after also reporting a jump in profits. The UK operator of managed pubs and restaurants, whose brands include All Bar One and O'Neill's, reported a jump in profits for the 52 weeks ended September 28, boosted by new site openings, stronger food sales, and higher prices.
Britvic, another FTSE 250 listed company, is up 4.0% after also reporting higher profits and revenues. The soft drinks maker increased prices and market share over its full year ended September 29. The company said sales were boosted by the hot summer weather in the UK this year.
Bank of England Governor Mark Carney is currently facing questions from the Treasury Select Committee over the central bank's latest inflation report. Meanwhile in Scotland, Scottish National Party leader Alex Salmond is laying out the details of the argument for Scottish independence. Both events will be watched with interest, especially given a dearth of top-tier macro-economic data in the calendar.
Still to come Tuesday, US housing starts data at 1330 GMT, followed by the Redbook of US retail sales at 1355 GMT and the US consumer confidence index at 1500 GMT.
By Jon Darby; [email protected]; @jondarby100
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