UK stocks gave up their day's gains at the close despite strong UK corporate results and forecast-beating numbers from Apple and Facebook overnight.
The FTSE 100 benchmark, which had climbed more than 50 points by early afternoon to top the 7,000 level, finished the day in negative territory at 6,961 points.
Although blue-chips such as Smith & Nephew (SN.), Unilever (ULVR) and Standard Chartered (STAN) advanced on strong first quarter results, weakness in mining stocks and high-street lender NatWest (NWG) were enough to offset the gains late in the session.
The pound continued its recent run against the dollar, edging up 0.15% to $1.3956, while gold rose 0.5% to $1,784 per ounce. Brent crude was also firmer, up 1.6% at $67.54 per barrel.
PROFITS SURGE AT SHELL
Royal Dutch Shell (RDSB) saw profits leap to $3.23 billion in the first three months of the year, allowing the and the energy giant to raise its dividend as planned.
But a warning that the outlook remained uncertain due to the pandemic sent the shares down 1.4% to £12.99 at the close.
Consumer goods giant Unilever rose 3.4% to £42.15 after a pick-up in home cooking and a strong economic recovery in China drove better-than-expected first quarter sales. The company also announced a share buyback programme up to €3 billion.
Smith & Nephew was the best FTSE performer with a5.6% rise to £15.69 after reinstating full-year guidance as visibility improved thanks to the Covid-19 vaccine rollout programmes and healthcare systems reopening to non-urgent surgery.
The wound care and knee and hip implants specialist is targeting underlying revenue growth of 10% to 13% and profit margins of between 18% and 19%.
Close behind was lender Standard Chartered (STAN) which added 5.5% to 522p after it reported upbeat first-quarter profit and said it would slash its global branch network by half, as it looks to cut long-term expenses.
FINE THREAT HITS BANK
On the downside, NatWest led the fallers with a 3.4% decline to 196.6p in the wake of its first quarter statement. Like other UK banks, NatWest was able to release some of the provisions it had set aside to cover expected pandemic-related bad loans but a warning that a money laundering case could trigger a big bill saw investors take fright.
NatWest CEO Alison Rose’s efforts to clean up the lender, including ditching the scandal-tainted Royal Bank of Scotland name, hit a setback last month when regulators launched criminal money laundering charges against it. If found guilty, the bank could face an unlimited fine.
Crypto miner Argo Blockchain (ARB) dipped 1.2% to 188p despite swinging into profit for the first time during 2020. The Bitcoin play reported a 120% jump in revenues during the year, adding that all of its mining machines have now achieved over 100% return on investment.
Shares in retailer WH Smith (SMWH) shed 3.6% to £18.15 after it warned of the possible risk of breaching its covenant tests in 2022 and launched a convertible bond offer worth up to £325 million.
ELSEWHERE ON THE MARKET
Mining giant Glencore (GLEN), which reported first-quarter production broadly in line with its expectations as coal production fell and copper production increased, saw its share price slip1%to 300p. The company forecast full-year marketing earnings within the top half of guidance.
Weir Group (WEIR) said it expected to deliver growth in line with current market expectations as it confirmed an 11% increase in group orders in Q1 as mining and infrastructure markets continue to strengthen. The update pushed its share price up 0.9% to £19.60.
Gross inflows into St James’s Place (STJ) reached £4.79 billion for the first quarter of 2021, 19% higher than the same period last year as investor confidence improved and clients returned to longer-term investments. The statement provided a 1.6% boost to its share price, to £13.45.
Schroders’ (SDR) assets under management remained stable for the first quarter of 2021, reaching £672billion at the end of March, compared with £630billion at the end of 2020. Shares added 0.4% to £35.75.
Insurance company Lancashire (LRE) said gross premiums written rose to a record for the March quarter, driven by growth in its property and casualty reinsurance segment. For the three months ended 31 March 2021, Gross premiums written increased by 46.1% year on year to $354.8 million. The news sent its share price up 4.4% to 710p.
Pershing Square (PSH) confirmed it will pay a second quarter dividend of 10cents, following its annual general meeting. The dividend will be paid on 18 June 2021. Its share price rose 7.5p on the back of the announcement, to £27.12.
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