FTSE Modestly Lower, As Markets Digest French Political Uncertainty -

FTSE Modestly Lower, As Markets Digest French Political Uncertainty

Jun 10, 2024Jeremy ParkinsonFinance, No picture0

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On Monday, London stocks experienced a decline as a result of investor concerns over a surprise election announcement by French President Emmanuel Macron. Additionally, investors were anticipating important domestic economic data later in the week. The FTSE 100, blue-chip index, dropped below 8,200 points in early trading before recovering and trading back towards the flatline on the session, the mid-cap FTSE 250 also fell, both indexes were on track to register a second consecutive day of losses. Analysts anticipate that the Bank of England (BoE) will make an independent decision to cut rates, separate from the Fed, and will closely monitor local economic data. This week, Britain is expected to release data on wages and GDP. The BoE is scheduled to meet in less than two weeks to decide on borrowing costs.Aviva, a life and general insurer in the UK, saw a 2% decrease in its shares, making it one of the top percentage losers on the FTSE 100 index. JPMorgan Chase removed Aviva’s stock from its analyst focus list and downgraded its rating to ‘neutral’ from ‘overweight’, while also cutting the target price to 550p from 575p. Despite this, the shares were still up approximately 10% year-to-date as of the last close. Conversely M&G Plc saw a 1.6% increase in its stock value following an upgrade in its rating from “neutral” to “overweight” by JPMorgan, leaving them top of the table on the day.Arecor Therapeutics Plc’s shares have plummeted by as much as 35% to a historic low. The biopharmaceutical group has announced that its working capital needs have increased due to the timing of potential pipeline revenue and rising costs. The company is exploring options for cost reduction in the short term, but if that is not feasible, it anticipates requiring funding in Q3 of 2024. In its annual results in February, the company had highlighted uncertainties in revenue growth timing and magnitude. The stock is currently down by 30.8%, resulting in year-to-date losses of approximately 37%.Ashtead is possibly the next blue chip to exit the London market. By midday, Ashtead’s stock had dropped, reversing earlier gains, amidst rumours that the equipment rental company is contemplating moving its listing to the US, where it earns the majority of its revenues.
FTSE Bias: Bullish Above Bearish below 8240