London midday: Losses pared after UK, Eurozone manufacturing data

3rd Jun 2013 11:42

Disappointing factory activity in China prompted sharp falls in early trading on Monday, though losses were pared by lunchtime after some better-than-expected manufacturing figures closer to home.The FTSE 100 sunk to an intraday low of 6,512 early on, falling to levels not seen since the start of May, after the final reading of the Chinese manufacturing purchasing managers' index (PMI) was revised lower to 49.2, worse than the initial 49.6 estimate. With any figure below 50 representing contraction, this now stands at its worst level in eight months. April's reading was 50.4.However, London's benchmark index rebounded slightly after both UK and Eurozone manufacturing came in ahead of consensus forecasts. The UK's own manufacturing PMI rose from an upwardly revised 50.2 to a 14-month high of 51.3 last month. Meanwhile, while the Eurozone activity still remains in contraction, the PMI increased to a 15-month high of 48.3, up from 46.7 the month before.Equities worldwide have been under pressure over recent sessions as markets begin to price in a 'tapering' of quantitative easing by the Federal Reserve, something that has been partly responsible for the impressive year-to-date surge across global indices. Ongoing better-than-expected economic data from the States continues to underwhelm as the improved outlook increases speculation that the Fed will soon begin to pull the plug, albeit gradually. Traders will continue to tread cautiously ahead of America's own manufacturing PMI figures due out later on today, the services PMI on Wednesday and the all-important jobs report on Friday.Polymetal gains after upgradeGold miner Polymetal International rose strongly this morning after JPMorgan Cazenove upgraded its rating for the stock from 'neutral' to 'overweight', citing an EPS inflection point next year following the sharp falls in the gold price earlier this year.Sector peers EVRAZ, Vedanta, Rio Tinto and Antogasta were also in demand, shrugging off the weak data from economic powerhouse China. Rio Tinto was in the news on takeover rumours concerning its 59% stake in Canadian subsidiary Iron Ore Co.Tullow Oil was making gains after Ghana last week approved the development plan for the Tweneboa-Enyenra-Ntomme (TEN) development which is expected to deliver first oil in 2016. Galvan said this morning that TEN could market the next phase of growth for Tullow and recommended investors to 'buy'.Food group Tate & Lyle rose after Jefferies kept a 'buy' rating, saying that the market is under appreciating the growth potential of its Speciality Food Ingredients division. In contrast, electricity provider Centrica was a heavy faller after Berenberg cut its rating to 'hold'.Manufacturing investment firm Melrose was in the red after confirming that it is eyeing a potential disposal of its lifting equipment divisions, Crosby and Acco, confirming media speculation over the weekend.UK engineering and construction firm Costain gained after being awarded one of four places on Transport for London's framework for Early Contractor Involvement and Construction, initially worth £200m overall.FTSE 100 - RisersAssociated British Foods (ABF) 1,871.00p +3.26%Tullow Oil (TLW) 1,078.00p +3.16%Polymetal International (POLY) 708.50p +2.61%Tate & Lyle (TATE) 836.50p +2.45%Vedanta Resources (VED) 1,289.00p +2.14%Kingfisher (KGF) 352.20p +1.91%Glencore Xstrata (GLEN) 328.95p +1.81%Evraz (EVR) 137.70p +1.77%Antofagasta (ANTO) 961.50p +1.69%Johnson Matthey (JMAT) 2,597.00p +1.41%FTSE 100 - FallersSage Group (SGE) 357.20p -2.16%Centrica (CNA) 372.30p -2.03%Aberdeen Asset Management (ADN) 457.20p -1.89%Tesco (TSCO) 358.55p -1.89%BT Group (BT.A) 296.70p -1.79%William Hill (WMH) 435.00p -1.74%ARM Holdings (ARM) 971.50p -1.67%Carnival (CCL) 2,209.00p -1.60%SSE (SSE) 1,530.00p -1.54%Experian (EXPN) 1,208.00p -1.15%FTSE 250 - RisersCarpetright (CPR) 635.50p +3.84%Heritage Oil (HOIL) 147.20p +3.73%Afren (AFR) 135.40p +3.20%QinetiQ Group (QQ.) 191.10p +3.13%Thomas Cook Group (TCG) 146.80p +2.80%Ashtead Group (AHT) 645.50p +2.30%IG Group Holdings (IGG) 591.00p +2.07%Invensys (ISYS) 405.10p +1.84%Premier Oil (PMO) 366.30p +1.78%Paragon Group Of Companies (PAG) 306.20p +1.76%FTSE 250 - FallersLonmin (LMI) 284.10p -3.69%Oxford Instruments (OXIG) 1,625.00p -3.45%Halfords Group (HFD) 318.30p -3.25%Brewin Dolphin Holdings (BRW) 237.10p -3.11%Moneysupermarket.com Group (MONY) 203.70p -2.07%Travis Perkins (TPK) 1,579.00p -1.99%Big Yellow Group (BYG) 405.80p -1.89%Templeton Emerging Markets Inv Trust (TEM) 600.00p -1.88%BH Macro Ltd. USD Shares (BHMU) 21.86 -1.84%Mondi (MNDI) 856.00p -1.78%