London open: Centrica and BAE lead markets lower after FOMC minutes

19th Feb 2015 08:43

Uncertainty surrounding the future of monetary policy in the States was weighing on UK stocks on Thursday morning, after the Federal Reserve showed it was wary of raising rates too soon.The FTSE 100 was down 0.3% at 6,879 early on, with energy provider Centrica and defence contractor BAE Systems leading the decline.UK markets had closed more or less flat the previous session with investors showing caution after the FTSE 100 closed at a new 15-year high on Tuesday. The index is now within touching distance of its all-time closing high of 6,930.20 reached in December 1999.Minutes from the last Federal Open Market Committee (FOMC) meeting in January showed that "many" members said a premature rate increase could be detrimental for the recovery, while "several" believed a later move could lead to high inflation.Many officials were worried that once the term "patient" is scrapped, markets will assume the Fed is set to move on "an unduly narrow range of dates", which could lead to "undesirably tight" financial conditions"."Our main takeaway from the January FOMC minutes is that concern about downside risk to inflation has risen and, consequently, the bar for raising rates by June is higher than it was in December," said Michael Gapen from Barclays.Minutes from the European Central Bank's own policy meeting will be released on Thursday for the first time in history. The minutes, due out at 12:30 GMT, will provide detail about the ECB's decision on 22 January to introduce a €1trn quantitative easing package.Centrica and BAE provide a dragWith oil and gas prices plummeting, Centrica has taken dramatic action by slashing its dividend and future payout policy, warning that earnings for next year will be lower than expected too. Shares in the British Gas owner dropped sharply after it said adjusted operating profits sank 35% to £1.7bn last year, with the dividend down 21% to 19.2p. BAE Systems also fell after reporting that sales and underlying profits at in 2014. However, the company did predict marginal growth in underlying earnings in 2015, as it eased worries about defence spending in the UK and painted a positive outlook for the US market.High street sportswear retailer Sports Direct impressed after saying it is confident of increasing profits this year despite a significant slowdown in sales growth in its third quarter.SABMiller edged higher despite the resignation of its chief financial officer Jamie Wilson for personal reasons. He will exit the board immediately and will officially leave the group on 31 March 2015.Drinks packaging group Rexam rose after agreeing a £5.4bn takeover by US rival Ball Corporation, a much larger higher valuation than had been expected by the market.Precious metals miners Randgold and Fresnillo gained as gold and silver prices advanced. Pharmaceutical group Glaxosmithkline and insurer Catlin were both trading lower after going ex-dividend.Market MoverstechMARK 3,125.63 -0.19%FTSE 100 6,879.01 -0.28%FTSE 250 17,000.37 -0.01%FTSE 100 - RisersRolls-Royce Holdings (RR.) 960.00p +2.73%Randgold Resources Ltd. (RRS) 5,095.00p +2.08%Fresnillo (FRES) 853.00p +1.67%British Land Co (BLND) 824.50p +1.60%Shire Plc (SHP) 5,165.00p +1.27%National Grid (NG.) 884.90p +1.25%Sports Direct International (SPD) 694.50p +1.17%Land Securities Group (LAND) 1,237.00p +1.14%Compass Group (CPG) 1,124.00p +0.99%Meggitt (MGGT) 571.50p +0.97%FTSE 100 - FallersCentrica (CNA) 257.40p -8.43%Tullow Oil (TLW) 398.00p -2.71%AstraZeneca (AZN) 4,377.50p -2.40%Anglo American (AAL) 1,236.00p -1.83%Weir Group (WEIR) 1,861.00p -1.79%GlaxoSmithKline (GSK) 1,529.00p -1.70%BG Group (BG.) 960.70p -1.64%Coca-Cola HBC AG (CDI) (CCH) 1,128.00p -1.31%SSE (SSE) 1,525.00p -1.17%BHP Billiton (BLT) 1,569.50p -1.13%FTSE 250 - RisersAfren (AFR) 12.35p +11.26%Rexam (REX) 558.00p +3.91%Man Group (EMG) 186.20p +3.67%Petra Diamonds Ltd.(DI) (PDL) 180.80p +3.26%Acacia Mining (ACA) 279.90p +2.08%Betfair Group (BET) 1,642.00p +1.92%Euromoney Institutional Investor (ERM) 1,027.00p +1.68%Entertainment One Limited (ETO) 292.30p +1.67%Genesis Emerging Markets Fund Ltd Ptg NPV (GSS) 533.00p +1.33%BTG (BTG) 805.00p +1.26%FTSE 250 - FallersComputacenter (CCC) 670.00p -4.49%Vedanta Resources (VED) 561.00p -3.36%Catlin Group Ltd. (CGL) 682.50p -3.26%Premier Oil (PMO) 178.50p -3.04%Hunting (HTG) 496.60p -3.01%Evraz (EVR) 189.90p -2.26%Soco International (SIA) 295.10p -2.25%Kaz Minerals (KAZ) 247.50p -2.10%Domino Printing Sciences (DNO) 731.00p -1.81%William Hill (WMH) 383.80p -1.79%