LONDON (Alliance News) - Stocks in London were mixed Wednesday midday, with the pound and the FTSE 100 consolidating several days of gains ahead of the UK referendum on European Union membership taking place on Thursday.
On the final day of political campaigning for the vote, IG analyst Joshua Mahony said "there is a tangible feeling of uncertainty and anxiety permeating through financial markets this morning".
"The difficulty is whether to believe the polls or the markets. History has shown us that despite the best efforts of pollsters to truly represent what would happen on the day, they have also got it wrong in the past," Mahony noted. "With that in mind, it is likely to be the case that the truth lies somewhere between polls and markets".
A new telephone poll by Survation, on behalf IG found the Remain camp at 45% compared to 44% for Leave, with 11% still undecided. This marked an increase of two points for Leave from the last Survation poll for the Mail on Sunday, which had Remain at 45% and Leave at 42%.
Polls of polls, which aggregate the results of multiple opinion polls, show a similarly split picture ahead of the vote. The Daily Telegraph's barometer, which is based on the average of the last six polls released, has the two level-pegging at 50% apiece, taking out undecided voters.
The FTSE 100 index was adding 0.3%, or 20.03 points, at 6,246.58. Meanwhile, the FTSE 250 was down 0.2% at 16,953.21 and the AIM All-Share was off 0.2% at 719.73.
With the blue-chip index higher Wednesday for the fourth consecutive trading session, market participants seem to believe that the Remain campaign will win the vote. Survation noted the IG EU Referendum Barometer, an indicator of what traders are predicting will happen in the referendum, shows a 75.5% chance of the UK voting to Remain, against a 24.5% chance of a vote to Leave.
The pound was holding gains made in an impressive rally on Monday, when it experienced its best session in eight years, after declining sharply last week as polls gave the Leave campaign the lead.
Having touched a high on Tuesday of USD1.4783, a level it hasn't seen since early January, sterling is quoted at USD1.4670 at midday Wednesday, compared to USD1.4661 at the London equities close on Tuesday.
"This week's pound performance marks a remarkable recovery from the lows struck last Thursday, arguably marking a major shift in the market's perception of the likely outcome of tomorrow's referendum," SpreadEx analyst Connor Campbell said.
Insurance and housebuilding stocks were among the best performers in the FTSE 100, with RSA Insurance Group up 2.3% and Taylor Wimpey up 1.8%.
However, at the other end of the index, Associated British Foods was missing the gains, down 3.3%, after Morgan Stanley downgraded the food, ingredients and retail group to Equal Weight from Overweight.
In contrast to the large-cap index, the mid-cap FTSE 250 was seeing more news-driven stock price movements. Specialty chemicals company Elementis was the worst mid-cap performer, down 6.6%, after saying its earnings for 2016 are set to miss market expectations amid difficult conditions for its chromium division.
The company, which manufactures additives used in industrial, personal care and oilfield drilling markets, said that while sales and margins in its North American chromium business are set to be broadly in line year-on-year, market conditions outside the North American market are proving challenging.
Elementis's specialty chemicals company peer Synthomer was down 4.6%, after UBS cut its recommendation on the stock to Sell from Neutral. The Swiss bank said it expects Synthomer to de-rate as the market prices in further medium- and long-term challenges.
Meanwhile, shares in Debenhams were down 4.2%. The department store chain said its annual pretax profit is set to meet its guidance, though it slightly pulled back its margin forecasts as like-for-like sales declined in the 15 weeks to June 11. Debenhams said the trading environment in the UK has been weaker since the turn of the year, particularly for clothing.
Among mid-caps in the green, Circassia Pharmaceuticals was up 7.3% at 104.10 pence, once more among the best mid-cap performers, following the 66% decline suffered on Monday.
The biopharmaceutical company's shares had pulled back 6.7% on Tuesday, rebounding from the losses seen Monday, when it had said a late stage study for its key cat allergy treatment failed to achieve its primary endpoint, as the treatment and a placebo used in the study proved equally effective. Having started trading in London in March 2014, the stock hit a record low of 87.00p on Monday.
Safestore Holdings was up 2.9% Wednesday, after saying it expects to complete the GBP44.4 million acquisition of Space Maker on July 29. The self-storage provider announced the deal in March and said the acquisition is set to be immediately earnings accretive. It added the purchase will support its future dividend-paying capacity. Like Safestore, Space Maker also provides self-storage facilities.
Meanwhile, shares in Grainger were adding 1.5% after JPMorgan upgraded the residential landlord to Overweight from Neutral.
In Europe, the CAC 40 index in Paris was up 0.2%, while the DAX 30 in Frankfurt was adding 0.5%.
In Asia, the Nikkei 225 index in Tokyo closed down 0.6%, the Shanghai Composite ended up 0.9%, while the Hang Seng in Hong Kong rose 0.6%.
In New York, stocks are called for a positive open, with the Dow 30, S&P 500 and Nasdaq 100 indices all seen up 0.1%.
Still ahead in the economic calendar, the focus will be on the US housing market with MBA mortgage applications at 1200 BST, housing price index at 1400 BST and existing home sales at 1500 BST. Federal Reserve Chair Janet Yellen will complete the second day of her testimony to Congress at 1500 BST.
By Daniel Ruiz; danielruiz@alliancenews.com
Copyright 2016 Alliance News Limited. All Rights Reserved.
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UK earnings, trading statements calendar - next 7 days
Wednesday 27 July | |
Aptitude Software Group PLC | Half Year Results |
BlackRock Energy & Resources Income Trust PLC | Half Year Results |
Breedon Group PLC | Half Year Results |
British American Tobacco PLC | Half Year Results |
FirstGroup PLC | Trading Statement |
Fresnillo PLC | Q2 Production Results |
GSK PLC | Half Year Results |
Hargreaves Services PLC | Full Year Results |
Hiscox Ltd | Trading Statement |
Ibstock PLC | Half Year Results |
International Personal Finance PLC | Half Year Results |
Lancashire Holdings Ltd | Half Year Results |
Lloyds Banking Group PLC | Half Year Results |
Marston's PLC | Trading Statement |
Motorpoint Group PLC | Trading Statement |
musicMagpie PLC | Half Year Results |
Nichols PLC | Half Year Results |
Primary Health Properties PLC | Half Year Results |
Quartix Technologies PLC | Half Year Results |
Reckitt Benckiser Group PLC | Half Year Results |
Rio Tinto PLC | Half Year Results |
Smart Metering Systems PLC | Half Year Results |
Smurfit Kappa Group PLC | Half Year Results |
Ted Baker PLC | Trading Statement |
Unite Group PLC | Half Year Results |
Wizz Air Holdings PLC | Q1 Results |
Yourgene Health PLC | Full Year Results |
Thursday 28 July | |
Airtel Africa PLC | Trading Statement |
Anglo American PLC | Half Year Results |
Aveva Group PLC | Trading Statement |
BAE Systems PLC | Half Year Results |
Barclays PLC | Half Year Results |
Bodycote PLC | Half Year Results |
BT Group PLC | Q1 Results |
Centrica PLC | Half Year Results |
CVS Group PLC | Trading Statement |
De La Rue PLC | Trading Statement |
Diageo PLC | Full Year Results |
discoverIE Group PLC | Trading Statement |
Dr Martens PLC | Trading Statement |
Elementis PLC | Half Year Results |
FDM Group PLC | Half Year Results |
Forterra PLC | Half Year Results |
Foxtons Group PLC | Half Year Results |
GB Group PLC | Trading Statement |
Greencoat UK Wind PLC | Half Year Results |
Hammerson PLC | Half Year Results |
Headlam Group PLC | Trading Statement |
Inchcape PLC | Half Year Results |
Indivior PLC | Half Year Results |
Informa PLC | Half Year Results |
ITV PLC | Half Year Results |
Jupiter Fund Management PLC | Half Year Results |
Logistics Development Group PLC | Trading Statement |
Metro Bank PLC | Half Year Results |
Mitchells & Butlers PLC | Trading Statement |
Mortgage Advice Bureau (Holdings) PLC | Trading Statement |
Mothercare PLC | Full Year Results |
MySale Group PLC | Trading Statement |
National Express Group PLC | Half Year Results |
Quixant PLC | Trading Statement |
Rathbones Group PLC | Half Year Results |
Relx PLC | Half Year Results |
Rentokil Initial PLC | Half Year Results |
Restore PLC | Half Year Results |
Robert Walters PLC | Half Year Results |
Schroders PLC | Half Year Results |
Segro PLC | Half Year Results |
Shell PLC | Half Year Results |
Smith & Nephew PLC | Half Year Results |
St James's Place PLC | Half Year Results |
Vesuvius PLC | Half Year Results |
Volex PLC | Half Year Results |
Weir Group PLC | Half Year Results |
Friday 29 July | |
Allianz Technology Trust PLC | Half Year Results |
Aston Martin Lagonda Global Holdings PLC | Half Year Results |
AstraZeneca PLC | Half Year Results |
Babcock International Group PLC | Full Year Results |
CMC Markets PLC | Trading Statement |
Croda International PLC | Half Year Results |
Glencore PLC | Trading Statement |
IMI PLC | Half Year Results |
Impellam Group PLC | Half Year Results |
Industrials REIT Ltd | Trading Statement |
International Consolidated Airlines Group SA | Half Year Results |
Intertek Group PLC | Half Year Results |
Law Debenture Corp PLC | Half Year Results |
Morgan Advanced Materials PLC | Half Year Results |
NatWest Group PLC | Half Year Results |
Premier Miton Global Renewables Trust PLC | Half Year Results |
Rightmove PLC | Half Year Results |
Shearwater Group PLC | Full Year Results |
Standard Chartered PLC | Half Year Results |
Walker Crips Group PLC | Full Year Results |
YouGov PLC | Trading Statement |
Monday 1 August | |
Ascential PLC | Half Year Results |
Cranswick PLC | Q1 Results |
Dialight PLC | Half Year Results |
GlobalData PLC | Half Year Results |
HSBC Holdings PLC | Half Year Results |
Hutchmed (China) Ltd | Half Year Results |
NAHL Group PLC | Trading Statement |
Pearson PLC | Half Year Results |
Senior PLC | Half Year Results |
Spectris PLC | Half Year Results |
XP Power PLC | Half Year Results |
Tuesday 2 August | |
BP PLC | Half Year Results |
Capital & Counties Properties PLC | Half Year Results |
Coats Group PLC | Half Year Results |
Devro PLC | Half Year Results |
Direct Line Insurance Group PLC | Half Year Results |
Domino's Pizza Group PLC | Half Year Results |
Fresnillo PLC | Half Year Results |
Greggs PLC | Half Year Results |
Keller Group PLC | Half Year Results |
Man Group PLC | Half Year Results |
Rotork PLC | Half Year Results |
Sage Group PLC | Q3 Results |
Staffline Group PLC | Half Year Results |
Synthomer PLC | Half Year Results |
Travis Perkins PLC | Half Year Results |
Virgin Money UK PLC | Q3 Results |
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