With Greece deciding not to pay the €300m due to the International Monetary Fund today, markets are unsurprisingly on the slide again.
As the country and its creditors seem as far apart as ever, and the deadline for a deal before the money runs out is fast approaching, the Greek decision to delay the IMF payment until the end of the month seems an escalation of the crisis.
So the FTSE 100 is currently down 42.02 points lower at 6817.22, on course for its biggest weekly fall since March. As well as Greece, investors are also nervous ahead of the US non-farm payroll numbers - which could give more clues as to the immediacy or otherwise of a Federal Reserve interest rate increase - and the latest Opec meeting, which is expected to keep oil production at current levels.
Despite the Greek woes, the largest faller in the leading index is currently Morrisons. The supermarket group is down 3.6p at 174.7p a day after its annual meeting and pay protest, as Deutsche Bank cut its target price from 210p to 180p. In a note on the food retail sector, it said:
We’ve seen no improvement in UK grocery market growth since the tentative rebound experienced December and January faded.
And on Morrisons in particular, it added:
We lower our 2015/16 UK earnings before interest and tax margin from 2.9% to 2.4%, which we forecast to remain flat thereafter. While the new chief executive, David Potts, did not start at Morrisons until the week after the full year results, the company still gave an explicit guidance for year end net debt of £1.9bn to £2.1bn. Our forecast cut today moves us from the bottom of that range (£1.9bn) to the midpoint i.e. £2bn. Management also gave relatively explicit guidance on interest, capex, property disposal proceeds, depreciation and working capital (although over a two year period).
Deutsche has also cut its target price on Tesco, down 1.2p at 207.45p, from 275p to 240p.
Mining companies have recovered some ground and given support to the market. Anglo American has added 17.5p to 1022.5p and BHP Billiton is 9p better at 1332.5p.
