Underwhelming industrial figures from China hurt Asia-exposed stocks and oil majors in the FTSE 100 on Monday, followed by disappointing US new homes data.
The FTSE 100 index closed down 27.50 points, 0.4%, at 7,460.70. The FTSE 250 ended down 19.55 points, 0.1%, at 18,438.55, and the AIM All-Share closed down 1.95 points, 0.3%, at 714.95.
The Cboe UK 100 ended down 0.4% at 745.00, the Cboe UK 250 closed down 0.1% at 15,986.35, and the Cboe Small Companies ended down 0.1% at 13,428.57.
In European equities, the CAC 40 in Paris ended down 0.4%, while the DAX 40 in Frankfurt also ended down 0.4%.
Underwhelming China data, as well as more negative headlines for its embattled property sector, meant the FTSE 100 lacked zeal on Monday.
Industrial profit growth for Chinese companies eased last month, numbers from the National Bureau of Statistics showed.
According to the NBS, industrial profit in October rose 2.7% year-on-year, ‘achieving positive growth for three consecutive months, and the efficiency of industrial enterprises continued to improve’. However, growth eased markedly from a roughly 12% surge in September.
Industrial profit declined 7.8% year-on-year over the wider 10-month period. The pace of decline narrowed from the 9.0% seen in the first nine months of 2023.
In the mining industry alone, profit declined by 20% year-on-year over the 10 months.
This hurt China-exposed stocks in the FTSE 100. Miner Rio Tinto lost 0.4%, Asia-focused lender HSBC lost 0.3%, while Prudential lost 1.4%.
Oil majors were also lower, tracking a fall in the price of Brent crude. BP lost 0.3%, while Shell lost 0.9%.
A barrel of Brent oil fetched $79.98 on Monday at the time of the London equities close, down from $81.47 on Friday.
An ounce of gold traded at $2,00.74, up from $1,999.98 late Friday. Gold miner Fresnillo was the second-best FTSE 100 performer, up 4.4%.
Chinese police have opened an investigation into Zhongzhi Enterprise Group after the debt-ridden financial giant declared itself insolvent, meanwhile.
Police in Beijing, where the group is headquartered, said late Saturday they had opened an investigation into unspecified ‘alleged offences’, adding that they had taken measures against several suspects.
Zhongzhi declared itself insolvent on Wednesday with its arrears estimated at nearly $66 billion, according to a letter to investors cited by local media.
During China’s real estate boom, many developers used Zhongzhi to finance their projects.
Meanwhile in the US, sales of new homes in October came in lower than expectations, while falling on the previous month.
Sales of new single-family houses increased to an annual rate of 679,000 last month, seasonally adjusted, the Commerce Department said in a statement.
This came in below September’s revised figure of 719,000 new homes and below FXStreet-cited consensus of 725,000.
‘New home sales surprised to the downside in October as climbing mortgage rates were an unavoidable drag. With mortgage rates coming off their multidecade high, new home sales may perk up in November,’ said Oxford Economics analyst Bernard Yaros.
Stocks in New York were mixed at the London equities close, with the DJIA down 0.2%, the S&P 500 index down 0.1%, and the Nasdaq Composite up 0.1%.
The pound was essentially steady at $1.2604 around at the local close on Monday, from $1.2605 late Friday. The euro eased to $1.0931 from $1.0935. Versus the yen, the dollar faded to JP¥148.97 from JP¥149.59.
Elsewhere on the FTSE 100, Rightmove led the index, surging 4.8%. The property portal said revenue growth has ‘continued to track marginally ahead of consensus expectations’ since it reported first-half results back in July. This is despite ‘uncertainty in the housing market’.
It has seen better-than-forecast average revenue per advertiser. Its ARPA is set to grow between £112 and £116 in 2023, better than its previous forecast of £103 to £105. In 2022, its ARPA amounted to £1,314. Its overall revenue growth outlook is at the 8% to 10% range.
It predicts underlying operating profit growth of 7% to 8%. In 2022, it achieved underlying operating profit of £245.4 million, on revenue of £332.6 million.
In addition, it set a 2028 revenue target of over £600 million, with underlying operating profit targeted at over £420 million.
Shaftesbury Capital was the best FTSE 250 performer, rising 3.7%.
It hailed a strong start to the Christmas trading period as the second half of 2023 recorded ‘excellent’ performance.
From July 1 to November 15, the property group said 440 leasing transactions were completed, representing £30.2 million of rent, 9% ahead of December 31, 2022 estimated rental value.
Over this period, there was ‘excellent’ leasing momentum across all uses, with 220 leasing transactions signed so far in the second half at rents on average 6% ahead of June 2023 estimated rental value, Chief Executive Officer Ian Hawksworth said. He noted there was a ‘strong’ leasing pipeline.
Over the medium term, Shaftesbury said it targets 5% to 7% rental growth per year.
Among London’s small-caps, Petrofac lost 7.6%. Shares in the provider of services to the energy industry suffered a sixth-successive daily decline, hurt by weaker oil prices of late.
On AIM, musicMagpie lost 16%, after BT and Aurelius said they are not intending to make an offer for the used-technology seller.
Last week Monday, musicMagpie confirmed it was in ‘early stage discussions’ with telecommunications provider BT, and with asset manager Aurelius, with a deadline of December 18 to announce a firm intention to make an offer or walk away.
On Monday, BT announced that it does not intend to make such offer, while musicMagpie announced that Aurelius last week Friday had released a statement that it does not intend an offer either.
FTSE 100 stock BT rose 1.0%.
In Tuesday’s UK corporate calendar, easyJet posts its full-year results, Pets At Home releases its half-year results, while Safestore posts a trading statement.
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