21st Mar 2014 10:56
LONDON (Alliance News) - UK stocks are narrowly mixed Friday, shrugging off strong gains posted by Asian and US equities overnight, amid a dearth of fresh UK macroeconomic data.
By mid-morning, the FTSE 100 is up 0.4% at 6,565.69, while the FTSE 250 is down 0.1% at 16,207.53, and the AIM All-Share index is fractionally lower at 859.89.
The muted session comes despite positive trading in both the US and Asia overnight.
On Wall Street, the DJIA, S&P 500, and NASDAQ Composite closed up 0.7%, 0.6%, and 0.3% respectively, while, in Asia, the Hang Seng closed up 1.2% and the Shanghai Composite index closed up 2.7%. The Nikkei in Tokyo, having ended down 1.7% on Thursday, was closed for the Spring Equinox holiday.
Meanwhile, in Europe, the CAC 40 and DAX 30 are both up 0.5%.
In the only UK data release of the day, the UK Office for National Statistics has reported that UK public sector net borrowing was GBP7.48 billion in February, but coming in under economists' expectations of a rise to GBP8.55 billion.
This saw the pound edge higher against its major rivals. Sterling currently trades at USD1.6506, EUR1.1962, JPY168.636, and CHF1.4567.
At the individual UK equity level, Resolution and Partnership Assurance are amongst the biggest winners in their respective indexes Friday, rebounding from their recent lows.
The companies, along with other annuity providers, have seen their shares plummet since Wednesday after UK Chancellor of the Exchequer George Osborne effectively destroyed the UK annuity market by allowing individuals more control of their pension pots.
However, Friday sees the stocks take back a fraction of their recent declines, with Resolution shares up 2%, making them the biggest winners in the FTSE 100, and FTSE 250-listed Partnership Assurance shares up 3.3%, making them the index's second biggest risers.
Bookmakers William Hill and Ladbrokes, however, are again heavy fallers as they continue to be hit by Osborne's announcement that the government will raise duty on gambling machines to 25% from the current 20%, starting from March 1, 2015.
FTSE 250-constituent Hikma Pharmaceuticals is another big loser. Jefferies has downgraded the company to Hold from Buy, saying that, following a "bumper" 2013 and a sharp share price increase so far in 2014, there is now the need to re-evaluate the stock.
The company's share price rose by 58% in 2013, has already jumped around 35% in 2014, and currently trades at around 1.5x the sector average. However, the investment bank now believes that Hikma's growth profile looks less attractive than in recent times, saying that "valuation appears stretched".
Despite this, Jefferies has increased its price target on the stock to 1,500.00 pence from 1,250.00p as it continues to view Hikma as a quality business.
Still to come in a quiet day in the economic calendar, the preliminary reading of eurozone consumer confidence is released at 1500 GMT.
With no fresh US data due to be released, focus will be on a slew of Federal Reserve speakers. President of the St. Louis Federal Reserve James Bullard, Dallas Fed President Richard Fisher, Minneapolis Fed Chief Narayana Kocherlakota and FOMC Member Jeremy Stein are all scheduled to give speeches Friday.
By James Kemp; [email protected]; @jamespkemp
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