Friday’s Master Investor Market Report

– The FTSE 100 fell 61.82 points to 6,7840.92.
– The FTSE 250 slipped 140.36 points to 17,949.09.
– The FTSE All Share dropped 32.65 points to 3,702.01.
– The FTSE AIM All Share finished 1.48 points higher at 774.89.

UK construction output fell by 0.8% in April, a drastic turnaround from March’s 1.4% rise. On a more positive note, the housing sector continued to expand during the month and the ONS revised construction output for the first quarter of 2015 upwards to -0.2% from -1.1% in its previous estimate. This will have a knock on effect on overall GDP of around 0.1%. Markit Chief Economist Chris Williamson commented that “our expectation is therefore that building activity, and growth in the wider economy, will continue to revive in coming months, though the strong pound and prospect of rising interest rates will probably mean 2015 growth fails to match the impressive 3.1% expansion that the ONS now estimates was seen in 2014”.

Greek bank shares fell sharply this morning after the IMF’s withdrawal from talks yesterday evening. After a strong performance earlier this week, stocks including National Bank of Greece and Piraeus Bank dropped by more than 10%.

Telecoms regulator Ofcom said that BT (BT.A) will face further cost controls on the wholesale prices that it can charge users of its leased lines. This is likely to affect significant portions of BT’s £2 billion leased services arm. The extent of these controls will be determined by Ofcom. BT shares rose by 6.65p to 453.5p.

Clothing retailer Bonmarche (BON) earned pre-tax profits of £12.4 million during the year ended 28th March, a 55.3% rise over the prior period as margins improved by 200 basis points to 6.9%. Revenue grew by 8.7% to £178.6 million after the firm opened a net 29 new stores over the year. Full year dividends will be 6.8p. Bonmarche shares grew by 17.5p to 287.5p.

The US Food and Drug Administration has recommended that AstraZeneca’s (AZN) mepolizumab drug be granted a biologics license application for treating adults with severe asthma. However, it was not recommended for use in adolescents and is still not approved for use anywhere else in the world. AstraZeneca shares fell by 61p to 4,211p.

Shares in fashion house Ted Baker (TED) rose by 35p to 2,850p after the company posted a 24% increase in revenues for the 18 weeks ended 6th June. Retail sales grew by 18.9% and the firm expanded its gross retail space to 345 thousand square feet. Guidance for the full year has been maintained.

Materials manufacturer Graphene Nanochem (GRPH) increased revenues by 53% to £48.3 million during 2014 after it signed a number of major deals and completed the enhanced oil recovery platform. Pre-tax losses narrowed to £6.8 million from £10.2 million in the prior year. Graphene also announced that it had won a new contract worth $28 million (£18 million) to supply drilling fluid to a national oil producer. Shares in the company finished 1.5p lower at 32.5p.

Shares in Petra Diamonds (PDL) plummeted 7.34% to 157.9p after the firm cut its full price forecasts to $430 million (£277 million) due to lower average selling prices. Current production grades are lower than in the past, with smaller stones of lower quality. Investec commented that “the news highlights the near-term challenges as the company mines from old and exhausted infrastructure and faces diluted ore problems”.

Press reports suggest that HSBC (HSBA) is in talks to sell its Turkish operations to Bahraini financial outfit Arab Banking Corporation as HSBC works to restructure its operations. The firm operates 300 branches and ABC is believed to be the leading contender despite competing interest from ING and BNP Paribas. HSBC shares dropped by 3.6p to 607.7p.

Monday’s news today

Majestic Wine (MJW), Redcentric (RCN), Eckoh (ECK), and Latchways (LTC) are all due to report full-year results on Monday.

Quote of the day

“Obstacles are those frightful things you see when you take your eyes off your goal.”
– Henry Ford