FTSE falls as Unilever sales slow

Marmite supplier and consumer goods giant Unilever (ULVR) shocked the market as underlying sales were weaker in the fourth quarter of 2016.

CEO Paul Polman warned it expected ‘a slow start’ to 2017, with growth improving as the year progresses.

The stock dropped 5% to £31.81 and dragged the FTSE 100 lower.

The UK economy grew by 0.6% between October and December, which was the same growth rate over the previous two quarters, according to the Office of National Statistics.

Despite the good news, the pound weakened against the dollar by 0.4% to $1.26.

West Texas Intermediate and Brent crude oil jumped by at least 1.8% to $53.72 and $56.22 per barrel, respectively.

Gold slumped 1% to $1,185 per ounce and copper remained static at $5,952 per tonne.

In US markets, the Dow Jones opened 0.2% higher today, while the S&P 500 was flat at 2,297.

Tokyo’s Nikkei 225 and Hong Kong’s Hang Seng index rallied by at least 1.4%, while Shanghai’s SSE Composite index nudged 0.3% higher.

FTSE 100 RISERS AND FALLERS

Investors were undeterred by the Royal Bank of Scotland’s (RBS) decision to put aside £3.1bn to settle claims that it mis-sold mortgage-backed securities in the US before the financial crisis.

It also said it would record a ninth consecutive annual loss.

Smirnoff maker Diageo (DGE) delivered better-than-expected first half results with organic volume growth of 4.4% ahead of expectations of 3.1%. The company celebrated a better performance in US spirits businesses, including the Johnnie Walker brand.

NOWTV and broadband provider Sky (SKY) was flat despite reporting that more UK customers were leaving its service, as its churn rate rose from 10.2% in the first half of 2016 to 11.6% in the first half of 2017. Management proposed to replicate Sky’s Italian loyalty programme in the UK to reduce the number of customers leaving.

Costa Coffee and Beefeater owner Whitbread (WTB) revealed like-for-like sales in the 13 weeks to 1 December slumped by 1.5% as it struggled in a ‘soft pub restaurant market’.

FTSE 250 RISERS AND FALLERS

Spread betting firm CMC Markets (CMCX) suffered a decline in third quarter revenue per client. Chief executive Peter Cruddas admitted regulatory changes this year would ‘present the group with some short to medium-term challenges as clients and the industry adjust’.

Budget-friendly cards retailer Card Factory (CARD) unwrapped good results due to strong Christmas trading. The retailer’s like-for-like store sales returned to growth in the fourth quarter in the face of a tough prior year comparative.

Luxury heels maker Jimmy Choo (CHOO) stepped into the limelight after reporting another year of record sales for the year to December. This reflected strong growth in Asia, solid growth in Europe and Japan and improving trends in its US retail business.

SMALL CAP RISERS AND FALLERS

Community care property partner Ashley House (ASH) was the biggest small cap faller as it continued to wait for clarity concerning the Government’s proposal to top up housing benefit to fund supported housing. Shares in the firm plummeted 22%.

Nu-Oil (NUOG) announced that investee firm MFDevCom would collaborate with COSL Drilling Pan Pacific to secure more projects earlier and cost-effectively.

Copper miner Weatherly International (WTI) reiterated it probably wouldn’t generate enough cash to repay loans if copper prices remained at current levels. Shareholders were worried about yet another potential fundraising and rushed to sell, causing the stock to fall 14%.

Platinum producer Lonmin (LMI) was disappointed with its first quarter production at its Generation 2 shafts, as it mined 5.2% less tonnes of the metal. The stock declined 21.3%.

Story provided by StockMarketWire.com