London open: Stocks start lower, weighed down by losses in China

27th Jul 2015 09:28

(ShareCast News) - A sharp drop in Chinese stocks overnight weighed on risk sentiment early on as investors prepared themselves for the US central bank's policy announcement on Wednesday and a wave of corporate results in the UK, US and over on the continent this week.As of 08:33 BST, the FTSE 100 was down by 22.78 points or 0.35% to 6,557.03, while the pan-European DJ Stoxx 600 lost 1.26%."Any suggestion that the Fed remains on track to raise interest rates in September, the next planned meeting, is likely to stoke quite a reaction in the markets. Investors remain in denial despite the repeated warnings from Yellen that they intend to raise rates this year."This makes earnings increasingly important as the current levels, not far from record highs, can only be justified by ultra-loose monetary policy or strong fundamentals. The absence of both could prompt investors to begin looking elsewhere for value. Already a lot of people consider there to me far more value in Europe and weaker earnings in the US will not help that," said Craig Erlam, Senior Market Analyst at Oanda.The Shanghai Stock Exchange Composite Index closed 8.48% lower at 3,725.558 - its largest single day decline since June 2007. On Friday, the country's State Council announced a widening in the Yuan's trading band, which could lead a modest depreciation, analysts at Deutsche Bank said.No less than 168 S&P 500 companies are due to report this week while over in Europe, 192 Stoxx 600 companies were due to update investors.Oil majors in particular were expected to garner a great deal of attention. According to the Financial Times, the world's biggest energy companies have delayed $200bn-worth of investments in new projects after the latest sell-off in oil markets.Troubling news-flow out of GreeceInvestors were also keeping an eye on events in the troubled Mediterranean nation amid reports of delays to the arrival of technical staff from its Troika of creditors. Weekend reports that a clique of hard-left members of the ruling Syriza party had at one point planned to raid the euro cash reserve in the country's mint and arrest the central bank Governor led to harsh criticism of the current government.IFO index, US durable goods orders on today's agendaIn the economic sphere, markets will be watching today for the latest German business confidence index courtesy of the IFO institute and the latest data on the euro area's money supply.The latter will help investors gauge how bank lending to the economy is holding up.Later in the day, the Confederation of British Industry will release the results of its Industrial Trends survey for July, followed by the latest data on orders for durable goods Stateside.RyanAir falls, Merlin Entertainments crashesRyanAir posted a 25% jump in first-quarter profit on the back of rising traffic, as it said full-year profit should be towards the upper end of its guidance range. The budget carrier reported profit after tax of €245m in the three months to 30 June, up from €197m in the same period last year, on revenue of €1.65bn from €1.50bn, as traffic grew 16% to 28m. In addition, the company said it was raising its full-year 2016 traffic target by 3m to 103m.The part-owner of The Economist, Pearson Group said it is negotiating to sell its 50% stake in the publication. Pearson, which last week sold the Financial Times to Japanese company Nikkei, said it was in discussions but "there is no certainty that this process will lead to a transaction."Shares Merlin Entertainment plunged after it warned full-year earnings would be about half of what it made last year, following a roller-coaster crash at its Alton Towers theme park in June. The company said in a half-year trading update while mid-year results were on track, the crash which seriously injured four people had impacted trade during the critical summer period. After the incident the company closed its Alton Towers resort and suspended marketing.Shares in consumer goods company Reckitt Benckiser gained after it raised its like-for-like revenue growth target for the full year, as it posted a jump in first-half pre-tax profit amid broad-based growth across its businesses. Pre-tax profit for the six months ended 30 June came in at £912m from £838m in the same period last year, on net revenue of £4.36bn, up 4% from 2014. Like-for-like revenue growth at constant currencies was 5%, ahead of analysts' expectations for a gain of around 3.6%.Insurer Hiscox reported a lift in pre-tax profit for the first half of the year, but warned mother nature could impact its business. The FTSE 250 firm reported pre-tax profits for the first six months up 8.4% to £135.1m from £124.6m, and said it benefited from a lack of major catastrophes.Food producer Cranswick reported an increase in revenue and underlying sales in the first quarter, as trading was in line expectations. In a short statement released on Monday, the group said revenue in the quarter to the end of June rose 8% year-on-year, as volume grew strongly across the company's divisions.Market MoverstechMARK 3,152.94 -0.42%FTSE 100 6,561.75 -0.27%FTSE 250 17,399.02 -0.57%FTSE 100 - RisersRandgold Resources Ltd. (RRS) 3,861.00p +3.12%BHP Billiton (BLT) 1,150.00p +2.36%Anglo American (AAL) 795.80p +2.29%Fresnillo (FRES) 631.00p +2.02%Weir Group (WEIR) 1,526.00p +1.73%Reckitt Benckiser Group (RB.) 6,000.00p +1.56%Rio Tinto (RIO) 2,430.00p +1.23%BT Group (BT.A) 467.30p +1.08%Centrica (CNA) 274.40p +0.92%Royal Dutch Shell 'B' (RDSB) 1,781.50p +0.65%FTSE 100 - FallersMerlin Entertainments (MERL) 400.00p -5.46%Experian (EXPN) 1,151.00p -2.87%Pearson (PSON) 1,195.00p -1.97%Persimmon (PSN) 1,915.00p -1.95%Hargreaves Lansdown (HL.) 1,157.00p -1.87%Barratt Developments (BDEV) 606.50p -1.78%Ashtead Group (AHT) 924.50p -1.65%Aberdeen Asset Management (ADN) 359.10p -1.62%easyJet (EZJ) 1,697.00p -1.62%3i Group (III) 550.00p -1.61%FTSE 250 - RisersCentamin (DI) (CEY) 55.60p +2.87%CLS Holdings (CLI) 1,885.00p +2.00%Pets at Home Group (PETS) 289.60p +1.86%Acacia Mining (ACA) 239.00p +1.70%Bwin.party Digital Entertainment (BPTY) 110.10p +1.38%Card Factory (CARD) 326.60p +1.33%Polymetal International (POLY) 452.40p +0.82%Drax Group (DRX) 256.80p +0.82%Ophir Energy (OPHR) 111.90p +0.81%Pace (PIC) 367.60p +0.74%FTSE 250 - FallersFidelity China Special Situations (FCSS) 138.00p -6.50%Vedanta Resources (VED) 417.00p -3.54%Ocado Group (OCDO) 397.90p -2.95%Evraz (EVR) 101.50p -2.87%Shawbrook Group (SHAW) 333.20p -2.29%Zoopla Property Group (WI) (ZPLA) 236.00p -2.28%Jimmy Choo (CHOO) 167.00p -2.22%Genus (GNS) 1,417.00p -2.14%Ashmore Group (ASHM) 271.30p -2.09%Aveva Group (AVV) 2,254.00p -2.00%