FTSE 100 in the doldrums, while Wall Street expected to show mixed start ahead of jobs data

• FTSE 100 down 13 points
• Deliveroo loses 23%
• Dow expected to edge higher at open

12.30pm: Investors cautious ahead of payroll report

Leading shares are still just about in the red as traders think about lunch (takeway from Deliveroo perhaps?)

The FTSE 100 is down 13.34 points or 0.20% on the last trading day of what has been a fairly reasonable quarter in all, with the index up nearly 5% since the start of January.

Over on Wall Street, there looks like being a mixed session in prospect. The Dow Jones Industrial Average is expected to open around 47 points or 0.1% lower at 33,019 but the S&P 500 and Nasdaq Composite are both looking at marginal increases.

Investors will be looking out for the latest employment figures from private payroll specialist ADP, ahead of the non-farm payroll numbers in a couple of days time.

Joshua Mahony, senior market analyst at IG said: “Jobs data out of ADP provides us with clues as to the direction of travel for Friday’s non-farm release, with traders hoping to see some initial benefit from the $1.9 trillion stimulus package agreed earlier in the month.”

The forecasts are for the ADP report to show a gain of around 550,000 jobs in March, after a rise of 117,000 last month.

Michael Hewson at CMC Markets UK said: “The US ADP employment report, due out later could also offer up further evidence of a booming US economy if the numbers in any way reflect the huge surge we saw in US consumer confidence in March.

“This afternoon’s numbers could well be an important leading indicator on Friday’s upcoming non-farm payrolls report, where we’ve seen a number of forecasters suggest we might see up to 900,000 new jobs added. While this may be on the optimistic side of forecasts any sort of bumper number will test the Fed’s narrative that a booming jobs market isn’t an inflation risk.”

Signs of inflationary pressures are likely to push up US bond yields again, and unsettle the stock market.

Also coming up is President Biden’s infrastructure proposals worth up to $4trn, which should give another lift to the US economy but may also stoke those inflation fears further.

11.30am: Power firm boosted

Apart from the excitement over Deliveroo‘s poorly received market debut – the nicknames are already there with Deliveroops and Flopperoo – there has been little for investors to get their teeth into.

There are continuing concerns about rising US Treasury yields, as well as uncertainty over any further fallout from the implosion of US hedge fund Archegos.

The FTSE 100 is currently down 17.49 points or 0.26% at 6754.63. A couple of analyst recommendations are helping to give some support to the market.

SSE PLC (LON.SSE) is up 21.5p or 1.5% at 1456p after Goldman Sachs raised its target price on the electricity business from 1762p to 1774p while Jefferies moved from hold to buy on Hikma Pharmaceuticals PLC (LON/HIK) , up 80p or 3.64% at 2280p and leading the FTSE 100 risers.

In the mid-caps, the FTSE 250 is barely changed, up just 7.66 points at 21,582.1.

Later come US jobs figures from ADP, ahead of the widely-watched non-farm payrolls on Friday, as well as the unveiling of President Biden’s infrastructure plan which could total $4trn.

10.14am: Oil firms down ahead of OPEC+ meeting

Oil companies are under presssure despite crude edging up ahead of this week’s meeting of OPEC+ which is expected to keep production curbs in place to support the price.

UBS said: “While the Suez Canal blockage was not really a major factor this has now been resolved but focus is very much on the OPEC+ meetings on 31-Mar/1-Apr with widespread expectation that there is a roll-over for at least another month of the bulk of the production quotas.”

Even so Royal Dutch Shell PLC (LON.RDSB) has seen its B shares slide 1.43% or 19.6p to 1349p, while BP PLC (LON.BP) is down 1.39% or 4.2p at 297.3p.

Meanwhile the FTSE 100 has improved from its worst levels and is now down 17.73 points or 0.26% at 6754.39.

(Deliveroo watch: down 23% at 299.4p)

9.29am: Standard Chartered leads fallers

Leading shares are ending a fairly upbeat quarter on a downbeat note. The FTSE 100 has risen by almost 5% in the first three months of the year, but renewed concerns about rising inflation have seen it slip 23.13 points or 0.34% to 6748.99 on the last day of the quarter.

Standard Chartered PLC (LON.STAN) is down 1.91% or 9.8p at 503.8p following a dip in Asian markets overnight. Just Eat Takeaway.com NV (LON.JET) is also among the leading fallers in the blue chip index, down 1.13% or 75.21 p at 6560.78p after the dismal start to listed life for rival Deliveroo Holdings PLC (LON.ROO), now down 20% at 308.9p in conditional trading compared to the offer price of 390p. Initially the shares fell as low as 271p.

Neil Wilson at Markets.com said: “ It’s a very big early move lower and there will be chatter about what this says about the broader market, investor appetite for listings, the state of the UK economy etc, etc… Chiefly though it reflects the fact that even pricing the IPO at the bottom of the range, Deliveroo was demanding too high a price tag for a loss-making delivery platform in a very competitive space with a questionable path to profitability. The books were covered, it was just plain mis-priced.”

8.33am: Subdued start on bond yield concerns

The FTSE 100 felt the drag from Wall Street and Asia’s main markets as it nudged into negative territory.

The bromide appears to have been administered by government bond yields, which have begun creeping up again amid lingering worries over the inflation outlook.

Mitigating a more pronounced delve into the red was a better-than-expected final read-out of 2020’s GDP  data – though the year was, on the whole, remained an unmitigated economic disaster.

The 9.8% collapse in output over 12 months was unprecedented in an historic context, but largely anticipated.

In fact, the performance in the final three months was marginally better than first thought with growth of 1.3%.

Turning to the markets, Richard Hunter struck this upbeat note with his review of the first quarter of 2021 and his assessment of the outlook.

“Markets remain on the front foot with perpetually conflicting elements generally skewed to the upside,” he said.

“Increasingly successful vaccine rollouts, fiscal stimulus packages and signs of nascent economic recoveries have all contributed, despite those very factors also raising concerns of inflation and a subsequent rise in interest rates rather earlier than expected.”

Topping the Footsie on a slow day was Hikma Pharma (LON:HIK), which advanced 3.3% on a Jefferies upgrade to ‘buy’.

BP (LON:BP.), meanwhile, was largely untroubled by a downgrade to ‘underweight’ by Morgan Stanley.

Proactive news headlines

DeepVerge PLC (LON:DVRG) has reiterated its guidance for 2021 as it said the year looks to be “promising” as it ramped up progress with its projects.

Seeing Machines Limited (LON:SEE) said it expects 30 car models to be fitted with its driver monitoring technology within the next two calendar years just from existing customers.

One Media IP Group PLC (LON:OMIP) said it split off its anti-piracy business TCAT into a new subsidiary to capitalise on the evolving music streaming market.

Amryt Pharma PLC (NASDAQ:AMYT, LON:AMYT) said has completed the rolling submission process that it hopes will end with the fast-track sign-off from the US Food & Drug Administration a gel for a rare and distressing skin disease.

Eden Research PLC (LON:EDEN) said its partner has received authorisation in Spain for its bio-fungicide.

Scotgold Resources Ltd (LON:SGZ) said it raised £1.5mln through a placing and will use the proceeds for working capital through the current production ramp up at the Cononish gold and silver mine in Scotland. It still expects production for calendar year 2021 to be within the guidance range previously provided.

Symphony Environmental Technologies PLC (LON:SYM) said it is aiming for continued growth in 2021 as the plastics specialist reported revenue growth last year despite the challenging conditions in the global economy.

InnovaDerma PLC (LON:IDP) remains “confident” that consumption levels for its products will “return quickly” as the UK’s eases lockdown measures ahead of peak tanning season, it said in an outlook statement accompanying final results.

IronRidge Resources Ltd (LON:IRR) sees 2021 as a pivotal year as it continues exploration programmes in Ghana, the Ivory Coast and Chad, the company said alongside its interim results.

Touchstone Exploration Inc (LON:TXP, TSX:TXP) said it encountered light oil at Chinook-1, part of the Ortoire block, and that further evaluation is required to determine commerciality.

Tower Resources PLC (LON:TRP) told investors the Cameroon authorities are supporting the company’s plans for the Thali license and it is working with its contractors to organise a schedule for the NJOM-3 well.

Condor Gold PLC’s (LON:CNR, TSX:COG) key objective this year is to continue to advance La India project in Nicaragua to production, the company said alongside its 2020 financial results. Pretax losses narrowed to £1.3mln, from £1.5mln in 2019, for the exploration and development company. 

Mineral & Financial Investments Limited (LON:MAFL) the mining and metals investor, increased net asset value 6% to a record 16.1p in the half-year to end-December.

88 Energy Ltd (LON:88E, ASX:88E) has confirmed that wireline logging operation are now underway for the Merlin-1 well, in Alaska. Hotly anticipated ‘preliminary’ results are expected over the weekend, it noted.

The Tavistock Investments PLC (LON:TAVI) board has reiterated that the takeover approach by Team PLC is “without merit”.

A new service has been launched by commodity broker SCB Group to help individuals offset their car’s CO2 emissions, called ClimatePositive. 

Mode Global Holdings PLC (LON:MODE) has appointed Ariane Murphy as its new chief investor relations officer.

NextEnergy Solar Fund Ltd (LON:NESF) announced that Sue Inglis has decided to step down as a director of the company with effect from 31 March 2021.

Capital Limited (LON:CAPD) said this year’s annual general meeting will be held at The CORE, 9th Floor, Ébène CyberCity, Mauritius on Wednesday 28 April 2021 at 10am GMT.

Thor Mining PLC (LON:THR, ASX:THR, OTCQB:THORF) said a webinar will be hosted by OTC Markets and Murdock Capital Partners at 3:30pm US Eastern Standard time on 30th March 2021.

6.50am: Footsie primed to open lower 

The FTSE 100 is expected to open in the red on Wednesday as negative sentiment from global markets overnight reached traders in London.

Spread-betters IG expect the blue-chip index to open 22 points lower after ending Tuesday’s session 36 points higher at 6,772.

Expectations of a slower start follow a sluggish performance for US equities overnight as optimism over a global economic recovery helped push up US treasury yields, piling pressure on stocks.

The Dow Jones Industrial Average ended Tuesday’s session down 0.31% at 33.066 while the S&P 500 dropped 0.32% to 3,958 and the Nasdaq fell 0.11% to 13,045.

The picture was similarly glum in Asia this morning with Japan’s Nikkei 225 down 0.82% while Hong Kong’s Hang Seng fell 0.48%.

US ADP jobs data later today could push yields even higher if evidence of an economic rebound is shown, although the key numbers will continue to be the non-farm payrolls that are due on Friday.

There will also be a restatement of the UK’s GDP reading for the fourth quarter of last year, which is expected to confirm 1% growth for the period and the avoidance of a double-dip recession, potentially raising hopes of an economic rebound once lockdown ends.

On currency markets, the pound was trading 0.13% lower against the dollar at US$1.372, although the US ADP jobs data could provide some catalysts for movement later today.

Around the markets:

Sterling: US$1.372, down 0.13%

Brent crude: US$64.46 a barrel, up 0.5%

Gold: US$1,680 an ounce, down 1.86%

Bitcoin: US$58,653, up 2.1%

6.50am: Early Markets – Asia / Australia

Stocks in the Asia-Pacific region were mostly lower on Wednesday even as China’s factory activity expanded at a faster-than-expected pace in March.

According to China’s National Bureau of Statistics, the manufacturing Purchasing Managers’ Index (PMI) came in at 51.9, compared to February’s reading of 50.6.

The Hang Seng index in Hong Kong slipped 0.31% while the Shanghai Composite in China fell 0.61%.

In Japan, the Nikkei 225 declined 0.73% but South Korea’s Kospi gained 0.05%.

Shares in Australia were an exception, with the S&P/ASX 200 closing 0.78% higher.

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Proactive Australia news:

FYI Resources Ltd (ASX:FYI) (FRA:SDL) has updated the definitive feasibility study (DFS) for its High Purity Alumina (HPA) Project resulting in an increase in forecast net present value (NPV) to more than US$1 billion.

Horizon Minerals Ltd’s (ASX:HRZ) recent drilling has demonstrated strong continuity and grade along a 600-metre strike at Crake Gold Project west of Kalgoorlie in Western Australia with bonanza grade results of up to 1-metre at 67.9 g/t gold.

Strategic Elements Ltd (ASX:SOR) has fabricated a prototype battery pack with 20 scaled-down connected battery ink cells, which successfully produced a 14-volt output solely by harvesting moisture from the air.

Paradigm Biopharmaceuticals Ltd (ASX:PAR) has executed a new collaboration agreement with bene pharmaChem which allows for the further development of injectable Pentosan Polysulfate Sodium (iPPS) and other formulations containing PPS to address unmet needs in new clinical indications.

Twenty Seven Co Ltd (ASX:TSC) (FRA:U9V) is off to an encouraging start at Mt Dimer with multiple high-grade results from the inaugural reverse circulation (RC) drilling campaign including up to 8.15 g/t gold and 26.9 g/t silver extending known mineralisation at relatively shallow depths.

Euro Manganese Inc (ASX:EMN) (CVE:EMN) (FRA:E06) has boosted its balance after closing the first tranche of its A$30 million (about C$29 million) private placement along with an initial investment from EIT InnoEnergy of €62,500 (about C$92,850), the first of three instalments with an aggregate value of €250,000.

BlackEarth Minerals NL’s (ASX:BEM) stage-2 large-scale pilot plant program has confirmed strong stage-1 results with grades of fixed carbon (FC) content of more than 95% reaffirming the potential of Maniry Graphite Project product as being highly attractive for downstream processing and feed for rapidly expanding electric vehicle markets.

Pharmaxis Ltd (ASX:PXS) (FRA:UUD) has entered a world-first clinical trial aiming to stop scars forming after trauma, particularly following burn injuries.

Story by ProactiveInvestors