Leading shares have lost some of Tuesday’s gains as a combination of fears - not least the economic turmoil in Russia - rattled investors once more. An overnight fall on Wall Street has not helped sentiment ahead of some major events during the day.
But one Russia-focused company is bucking the trend, with Evraz - the steelmaker where Chelsea football club owner Roman Abramovich has a major stake - up 5.4p at 123.6p after Deutsche Bank raised its target price from 123p to 164p.
Overall the FTSE 100 has fallen 47.60 points to 6284.23, with the volatility in the rouble continuing to highlight the precarious state of the Russian economy as the oil price slides and sanctions bite.
Further uncertainties include the Greek presidential poll - the first of three - which, if it does not go the government’s way, could lead to a full blown election.
The US Federal Reserve issues its latest report, which will be widely watched for signs of when interest rates may rise.
Elsewhere Dixons Carphone is heading the FTSE 100 risers, up 15.1p at 441.8p after better than expected half year results from the newly merged business.
The company reported like for like revenue up 5% and profits up from £85m to £100m. It hailed the Black Friday discount day as a major success, but warned that Christmas was still crucial as it reported better than expected profits. It also benefited from the demise of Phones 4U but that also required increased investment in stores. Chief executive Sebastian James said:
This has been a very good half year but there is a lot more of the year to go and a crucial Christmas to come, against a backdrop of big changes in how and when customers do their Christmas shopping. Black Friday was an extraordinary - and fun - day but we are all acutely aware that there is no room for complacency. Ahead of this all important peak period we remain comfortable with market expectations for this year.
Alistair Davies at Investec said:
Maiden interims for DC were expected to be confusing given different accounting periods (6 months Dixons, 7 months for Carphone). Earnings before interest and tax came in at £100m with pretax profit of £78m, ahead of company-compiled consensus of £79m and £58m respectively. Greater focus in our view should be placed on the second quarter’s excellent trading performance and the outlook for the core business, synergy potential and developments within Connected World Services. We upgrade [2016 and 2017] forecasts by 2.5% and 4% and raise our target price to 465p. Buy.
Keith Bowman, equity analyst at Hargreaves Lansdown Stockbrokers said:
The newly merged company has made a promising start. Targeted cost savings are expected to materialise a year ahead of schedule, the fall of Phones 4U has clearly played its part, while free warranties on products such as high-end TVs has further contributed. Economic recovery in its core UK and Irish markets has also aided performance, whilst its newly separated business services division (Connected World Services) has made solid progress, doubling pro forma revenues.
Less favourably, the group’s overseas operations remain broadly challenged. Stores in the Netherlands and Germany are being closed, with market pressures in Spain being reported. Furthermore, despite highlighted sales momentum for its Nordic business, current turmoil in the oil market could impact consumer sentiment and subsequent performance going forward.
Elsewhere Petrofac, the oil services group which has been hit by the fall in the oil price, has dropped 14.5p to 673.5p as Citigroup moved from buy to neutral, cutting its target price from £12.50 to £760p.
