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FTSE 100 suffers a triple-digit fall

  • FTSE 100 index sheds 133 points
  • Verona Pharma provides some cheer
  • Europa Metals surges on resource upgrade

10.50am: Triple-digit fall for the Footsie

Dull and overcast is not just a description of the weather conditions in London; it accurately describes the stock market too.

The FTSE 100 has slumped 133 points (2.2%) to 6,052, with travel and hospitality-related stocks really getting it in the neck.

“The FTSE 100 faltered badly on Friday, taking its cue from weak trading in Asia overnight sparked by worse than expected economic data out of China,” said Russ Mould, the investment director of AJ Bell.

“China was first in to the coronavirus crisis and arguably one of the first to come out of its first phase, so the fragile nature of its recovery offers an uncomfortable view of the future for other countries. Amid weakening sentiment, safe haven gold steadied at around the $1,950 mark,” he added.

Traders cant even console themselves with the prospect of a crafty look at the cricket; it is looking like it might be too dark for much – if any – play to take place this morning in the second test between England and Pakistan.

Just three Footsie stocks are defying the trend – packaging giant Smurfit Kappa Group plc (LON:SKG) and two housebuilders, Persimmon PLC (LON:PSN) and Taylor Wimpey PLC (LON:TW.).

Away from the big caps, Verona Pharma PLC (LON:VRP), up 28% at 92.5p, was providing plenty of cheer as the firm said it is gearing up for a busy period with two clinical trials of its lead drug ensifentrine set to get underway before the end of the year.

Europa Metals Ltd (LON:EUZ) shares surged 23% to 20p after the group released a resource upgrade for the Toral lead-zinc-silver project located in northern Spain.

$EUZ Europa Metals shares surge as it upgrades Toral lead-zinc-silver resources https://t.co/0FRiKqnu8g via @proactive_UK @EuropaMetals #EUZ

— Proactive (@proactive_UK) August 14, 2020

9.30am: Leisure and travel stocks hit hard by quarantine decision on France

Just three Footsie constituents were in positive territory as the index slumped below the 6,100 level, with travel and hospitality-related stocks hit hardest.

Londons index of leading stocks was down 95 points(1.5%) at 6,091.

British Airways owner International Consolidated Airlines Group SA (LON:IAG), down 5.6% at 192.95p, after fears of a second wave of coronavirus cases look like being realised in many parts of the world.

Aeroplane engines maker Rolls-Royce Holdings PLC (LON:RR.) was down 4.5% at 255.6p while automotive and aerospace engineer Melrose Industries PLC (LON:MRO) was off 3.7% at 102.7p.

Hotels groups Intercontinental Hotels Group PLC (LON:IHG) and Whitbread PLC (LON:WTB) were also feeling the chill, as was contract caterer Compass Group PLC (LON:CPG); all three were down by around 4%.

“With France being added to the quarantine list for the UK, travel & leisure is under pressure. Shares in IAG, Ryanair, Tui and EasyJet were all sharply lower as the move will force a large swathe of cancellations right at the peak of the summer holiday season for one of the largest markets for UK tourists,” observed Neil Wilson at markets.com.

“The quarantine decision also underlines the inherent risk you take in booking a holiday abroad right now, which will do nothing for consumer confidence,” he added.

Talking of easyJet PLC (LON:EZJ), the low-cost airline completed the previously announced sale and leaseback of 23 aircraft but thats not the reason why the shares are down 7.% at 564.99p.

People arriving in the UK from France after 04:00 BST on Saturday will have to quarantine for 14 days, minister says https://t.co/gslgqG33Mw

— BBC Breaking News (@BBCBreaking) August 13, 2020

8.30am: Weak start to Friday

The FTSE 100 index defied predictions for a positive start on Friday to open in negative territory as UK share prices reflected worries over a lacklustre batch of economic data from China and the inability of Americas senior politicians to agree a renewed stimulus package

The index of UK blue-chips fell 33 points to 6,152.18.

Markets in Asia began to wobble after Beijing announced a seventh straight monthly decline in retail sales and said fixed-asset investment in areas such as infrastructure and property also fell, defying predictions of a rebound.

Closer to home, the UK looks set to add France to its list of quarantine countries as an upsurge in cases across Europe threatens to derail a return to normality after the lifting of coronavirus (COVID-19) restrictions.

On the market, the fallers were the regular assortment of lockdown laggards – anything with links to air travel and hospitality.

So, Rolls Royce PLC (LON:RR.), the jet engine maker, was off 4.2%, while British Airways owner IAG (LON:IAG) was off 3.5%. Intercontinental Hotels (LON:IGH) made up the trio of Footsie losers with a 1.9% decline.

Dropping down to the second-tier, tour operator TUI (LON:TUI) continued its post-results slide with a 6.2% decline, with budget airline easyJet (LON:EZJ), off 5%, following in its vapour trails.

Finally, Dominos Pizza (LON:DOM) fell 5% after Citi reiterated its sell advice on the stock in the takeaway food giant.

Proactive news headlines:

Europa Metals Ltd (LON:EUZ) shares surged in early deals on Friday after the group released a resource upgrade for the Toral lead-zinc-silver project located in northern Spain. The new independent resource estimate is for 3.8mln tonnes with a zinc equivalent grade (including lead credits) of 8.3% and silver at 30 grams per tonne. It marks a 40% increase in overall resource tonnes, including a 38% rise in contained, a 36% increase in lead and a 32% lift to silver volume. Toral now has a total resource of 17mln tonnes grading 6.9% zinc equivalent with 4.1% zinc, 2.9% lead, and 24 grams per tonne silver – representing 720,000 tonnes of zinc, 510,000 tonnes of lead, and 14mln ounces of silver.

Verona Pharma PLC (LON:VRP) is gearing up for a busy period with two clinical trials of its lead drug ensifentrine set to get underway before the end of the year. “Clinical data from prior studies of ensifentrine in other respiratory diseases have demonstrated ensifentrine improves lung function and reduces cellular markers of inflammation in the lungs,” the company said in an update on operational and financial results for the three months and six months to June 30, 2020. “We believe ensifentrine, with its novel mechanism of action, has the potential to improve oxygenation and lung function assisting recovery from COVID-19.” Financially, Verona is well set to achieve its plans. It ended the six months to June 30, 2020, with net cash of just over £18mln, a figure boosted in July with proceeds from a £159mln private placing.

Westminster Group PLC (LON:WSG), the supplier of managed services and technology-based solutions, has revealed that it moved into profit in the first half of 2020. The group, which was operationally cash positive in the first half of the year, made a profit before tax of £236,000 versus a loss of £787,000 in the first half of last year, on revenues that rose by 24% to £6.96mln from £5.61mln. Underlying earnings (EBITDA) also turned positive, with EBITDA of £893,000, compared to a loss of £49,000 in the same period of last year. The coronavirus (COVID-19) pandemic has presented some challenges to the company but also some opportunities – e.g. fever screening at airports – and Westminster saw a significant increase in product sales worldwide, which more than offset reductions in other parts of the business.

Touchstone Exploration Inc (LON:TXP) revealed it has spudded the hotly anticipated Chinook-1 well, its latest exploration test within the Ortoire block, Trinidad as it posted as second-quarter operational update and financial results. The Chinook-1 well is targeting hydrocarbon prospects in the Herrera formation, the same horizon found in the successful Coho and Cascadura discoveries. It will be drilled to a depth of 9,880 feet and the drill programme is expected to take 40 days.

ANGLE PLC (LON:AGL) has noted the results of new research from the Laboratory of Translational Oncology, School of Medicine, University of Crete, which demonstrated the potential of its Parsortix liquid biopsy system to assess whether non-small cell lung cancer (NSCLC) patients will respond to immunotherapy drugs. The AIM-listed firm said the study had combined an assessment of immunotherapy drugs known as PD-L1 immune checkpoint inhibitors, a novel treatment offered to patients with certain advanced cancers, with a second immune checkpoint, Indolamine-2,3-dioxygenase (IDO), on a patient's circulating tumour cells (CTCs). ANGLE said the study demonstrated that the detection of IDO and CTCs, particularly of the IDO+/PD-L1- CTC subpopulation harvested using Parsortix, is significantly associated with reduced progression-free survival and overall survival in NSCLC patients treated with anti-PD-1 agents.

Horizonte Minerals PLC (LON:HZM) has maintained a strong cash position as it moves towards the construction phase of the Araguaia nickel mine in Brazil, the group revealed as it reported half-year results. The miner said it had £15.6mln in the bank as at the end of June 2020 following the royalty arrangement with Orion Mining Finance signed at the end of 2019. The AIM-listed group announced yesterday that it had signed up five banks to lead the arrangement of a US$325mln finance package for the first phase at Araguaia.

Condor Gold PLC (LON:CDR) has revealed its objective remains to commence site preparation at its La India site in Nicaragua and place a deposit on a processing plant by the end of 2020, the miner said as it reported quarterly and half-year results. Condor currently has 1.12 million ounces (oz) of gold open pit mineral resources at La India permitted for extraction, inclusive of a mineral reserve of 675,000 oz gold. It is targeting production of 120,000 oz gold per annum from open-pit material for 7 years. Condor posted a loss of £355,000 in the half-year to June 30, 2020, reflecting the fact it is still in its development stage. Cash at the end of June was £7.5mln.

Integumen PLC (LON:SKIN) announced that it has received notification from multiple warrant holders to exercise warrants over 29,404,762 shares in the share capital of the company. This consists of 26,071,429 warrants with an exercise price of 2p and 3,333,333 warrants with an exercise price of 1.5p. The consideration for the exercise of the warrant shares amounts, in aggregate, to a cash value of £571,428.57. Gerard Brandon chief executive officer of Integumen commented: "The largest institutional shareholder, Helium Rising Stars Fund, who currently hold 7.3% of Integumen shares are exercising 60% of the above warrants which will increase their holding to 8.7%. We are grateful for their continued confidence in the future growth of the Company."

Gfinity PLC (LON:GFIN), a leading esports and gaming solutions provider, announced that it has received warrant exercise notices over an aggregate of 10,000,000 new ordinary shares of 0.1 pence each in the capital of the company with an exercise price of 1p per share, providing the company with proceeds of £100,000.

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