FTSE 100 southbound as TSCO, ABF, pharmas fall

London equities opened southbound amid continuing concerns about a so-called 'hard' Brexit and ensuing sterling weakness, but it remains to be seen whether the blue-chip index will rally to another record close or snap its multi-session winning streak.

Not long after the open, FTSE 100 was down 25.82 points, or 0.35%, to 7264.67, while FTSE 250 was down 79.44, or 0.43%, to 18,314.7. Blue-chip losers outnumbered winners by 70 to 30 in a session comparatively rich in top-100 news. There was a long list of FTSE 350 stocks going ex-dividend.

Associated British Foods (ABF), down 3.37% to 2607p, said revenue from continuing operations for the 16 weeks ended 7 January was 10% up on a year ago at constant currency, with good growth delivered by all of its businesses.

Tesco (TSCO), down 2.37% to 203.85p and leading several supermarkets south, reported Q3 group LFL sales growth of 1.5%, and noted LFL group sales in the six weeks to Jan. 7 were up 0.3%. "We are very encouraged by the sustained strong progress that we are making across the Group."

Pharma fell behind Shire (SHP), off 2.85% to 4548p, and Hikma (HIK), lower 1.68% to 1872p. The sector has suffered after US president-elect Donald Trump yesterday said pharmas were "getting away with murder" in what they charge the government for medicines, and promised change.

Several house builders eased after Barratt Developments (BDEV), down 1.16% to 495.2p, said expected H1 pretax profits to be about £315m, about 7% higher than a year ago. The group says overall market conditions are healthy with strong demand in the period for new homes.

Also lower were several commercial property stocks, leisure, high-street retail and a number of banks. To the upside, the story was laden with miners. Gold-sensitive plays Fresnillo (FRES), up 3.33% to 1427p, and Randgold (RRS), up 2.78% to 6742.5p, led the pack.

Several utilities rose, too. National Grid (NG.), up 0.26% to 936.25p, noted BEIS and Ofgem's confirmation they believe a more independent electricity System Operator, within the firm, can realise benefits for consumers by enabling a more secure, competitive and flexible system.

Marks & Spencer (MKS), up 1.34% to 344.95p, said group reported sales in the 13 weeks to Dec. 31, 2016, were up 5.9%, in total terms, while in constant-currency terms they firmed 4.3%.Total UK sales were up 4.5%, while on a like-for-like basis they rose 1.3%.

At 8.35am, WTI crude was down 0.02% to $52.24/bbl and Brent was up 0.27% to $55.25/bbl. Gold was up 0.45% to $1202/oz, with silver and copper also making moderate gains.

BIGGER MOVERS

Tertiary Minerals (TYM), down 35.71% to 0.68p, said that whilst it remains on track with its fluorspar strategy and the development of its fluorspar assets, it recognises the benefit of finding projects capable of generating revenue and profits in a shorter timescale than is achievable with the current portfolio of projects.

Mayan Energy (MYN) fell 25.81% to 0.01p as it updated on operations at the Shoats Creek Field, Louisiana, and of the recommencement of production at Oklahoma Energy (OKE). Meantime, Red Rock Resources (RRR), down 15.25% to 0.5p, has issued an update in relation to its investment in the Shoats Creek Field in Beauregard Parish, Louisiana.

Greatland Gold (GGP) rose 17.14% to 0.2p as it said that drilling has successfully identified two large zones of gold mineralisation at its Ernest Giles project in Western Australia.

LONDON HIGHLIGHTS

STM Group (STM), up 11.84% to 42.5p, said it has traded in line with market expectations of profit before tax of £2.7m for 2016, versus £2.7m in 2015. Savills (SVS), up 6.15% to 733p, said it now anticipates that underlying results for the year to 31 December 2016 will be meaningfully ahead of our previous expectations.

Spire Healthcare (SPI), down 10.78% to 307.9p, said it expects the EBITDA outcome for 2017 to be in line with 2016, before the Group returns to mid to high single digit EBITDA growth from Financial Year 2018 onwards.

JD Sports Fashion (JD.), up 5.98% to 344.85p, said it has maintained the excellent momentum from the first half of the year. Directors expected FY headline pretax profit, prior to exceptionals, would exceed current consensus market expectations of £200m by up to 15%.

AO World (AO.), down 5.78% to 173.65p, expects its FY performance to fall within the guidance previously given, but remains cautious about Q4 given the uncertain UK economic outlook, currency impacts on supplier pricing and the possible effect on consumer demand.

Robinson (RBN), down 3.91% to 135p, said its revenues are anticipated to be £27.5m for the year, which represents an overall 5.6% decrease on last year. In 2017, directors expect to deliver revenue and earnings growth.

Debenhams (DEB), up 3.37% to 56.18p, reports a good performance in the 18 weeks to 7 January with group gross transaction value up 3.7% and like-for-like sales as reported up by 3.5%.

Hays (HAS), up 1.32% to 160.90p, reports solid overall growth of 2% (underlying growth of 3% adjusted for working days) in the second quarter to the end of December led by further good performances in its International businesses, which now represent 75% of net fees.

Other stocks in the news included ASOS (ASC), Marshall Motor (MMH), Tekcapital (TEK), Totally (TLY), SuperGroup (SGP), Stadium Group (SDM), Booker (BOK), Dunelm (DNLM), JKX Oil & Gas (JKX), Polar Capital Holdings (POLR) and Rathbone Brothers (RAT).