Financials, Taylor Wimpey pull FTSE 100 lower; Next shines

Financials, Taylor Wimpey pull FTSE 100 lower; Next shines
FILE PHOTO: Signage is seen outside the entrance of the London Stock Exchange in London, Britain. Aug 23, 2018. REUTERS/Peter Nicholls   -  Copyright  PETER NICHOLLS(Reuters)
By Reuters

By Shashwat Awasthi

(Reuters) – London’s FTSE 100 edged lower on Wednesday, as a results-driven slide in shares of wealth manager St. James’s Place, mortgage lender Lloyds and homebuilder Taylor Wimpey overshadowed upbeat forecast from clothing retailer Next.

The main index <.FTSE> lost 0.3%, as exporter stocks also weighed after the pound rebounded slightly from a 28-month low.

The mid-cap FTSE 250 <.FTMC> inched 0.2% lower by 0757 GMT, as steep losses in mall operator Intu <INTUP.L> and carmaker Aston Martin <AML.L> weighed.

Wealth manager St. James’s Place <SJP.L> fell 5.3%, on course for its worst day since June 2016, after it missed forecasts for operating profit, as weaker client sentiment weighed on inflows of new money in the first half of the year and costs rose.

Shares of Lloyds Banking Group, Britain’s biggest mortgage lender, slipped 5% and were tracking their worst day in more than three years after a further charge to meet claims for mis-sold insurance to consumers hit the company’s earnings.

Housebuilders <.FTNMX3720>, which have been under pressure due to heightened worries of a no-deal Brexit under new Prime Minister Boris Johnson, skidded after Taylor Wimpey <TW.L> forecast a fall in annual margins. The company’s shares were down 3.7%.

Despite the session’s losses, the blue-chip index is set to post its second straight month of gains, largely as investors bet that the U.S. Federal Reserve and other central banks will cut interest rates.

“We also have to wonder just how much the Fed can deliver for the market now that so much is already expected of it,” analyst Neil Wilson said.

The Fed is widely tipped to pull the trigger on a 25 basis points rate cut later on Wednesday and sentiment could well be determined by whether the bank hints at any future policy easing.

The FTSE 100’s losses were kept in check by retailer Next <NXT.L>, which jumped 8.5% to a more than one-year high after it raised its full-year sales and profit targets. Rival Marks & Spencer <MKS.L> gained 1.4%.

The mid-caps were hit by weakness in Intu and Aston Martin, whose shares sank more than 17% each after their respective half-year reports disappointed investors.

“Aston Martin’s latest numbers are nothing short of a disaster … as the pre-IPO optimism of late last year has become a distant memory, with investors undergoing a significant reality check,” CMC Markets analyst Michael Hewson said.

(Reporting by Shashwat Awasthi in Bengaluru; Editing by Anil D’Silva)

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