European markets slip after weaker service sector data
The FTSE 100 moved 0.2%, or 14.83 points, lower to finish at 7,437.93.
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Your support makes all the difference.Europe’s biggest markets finished in the red after weak service industry figures dragged on trading sentiment.
Markets recovered ground during the session, but failed to close higher as investors remained cautious.
In London, the top index was buoyed by strong showings by Shell and BP due to a resurgence in oil prices.
The FTSE 100 moved 0.2%, or 14.83 points, lower to finish at 7,437.93.
Germany’s Dax index was 0.34% lower for the day and the Cac 40 closed down 0.34%.
Michael Hewson, chief market analyst at CMC Markets UK, blamed the “disappointing” service industry PMI data for early weakness, before the main indexes reduced their losses.
“European markets have managed to recover from the lows of the day, with the FTSE 100 trying to rebound into positive territory helped by a strong performance from the energy sector,” he said.
“The biggest losers today have been in the retail sector after JPMorgan Chase cut its ratings on the likes of Tesco, B&M, and the rest of the grocery sector on expectations that falling food prices will start to impact on retailer margins”
Stateside, the US markets took their cues from Europe to open slightly lower, with shares in Manchester United sliding due to reports the Glazer family might not sell the club.
Meanwhile, the pound was down 0.34% to 1.258 US dollars but was 0.3% higher at 1.173 euros at market close in London.
In company news, Johnson Service Group jumped in value after it hiked its outlook and told investors that the proportion of money being spent on labour costs dropped and is set to fall further.
The workwear and textiles specialist reported that its financial results for the full year will be better than previously thought, in its second upgrade in as many months.
Johnson Service Group shares rose 14p to 138p.
Royal Mail owner International Distributions Services saw shares finish higher after regulator Ofcom announced plans to review the UK’s universal postal service regime.
Shareholders cheered the announcement, which could support Royal Mail’s efforts to reduce letter deliveries from six days a week to only five. Shares in the parent firm lifted 3.8p to 241.5p.
B&M European Value Retail was in the red despite securing a roughly £13 million deal to buy up to 51 shops from stricken rival Wilko to support its growth plans.
Shares in the company were 19.2p lower at 547.8p as traders were more swayed by the downbeat report from brokers at JP Morgan Chase, as well as the weaker UK service industry figures.
The price of oil jumped to its highest since November last year after Saudi Arabia and Russia confirmed that they would be extending their output cuts which started in July.
A barrel of Brent crude rose by 2.18% to 90.94 US dollars as markets were closing in London.
The biggest risers on the FTSE 100 were Whitbread, up 80p to 3,565p, Centrica, up 3p to 156p, BP, up 9.8p to 511.5p, Weir Group, up 32.5p to 1,896.5p, and IAG Group, up 86p to 6,068p.
The biggest fallers on the FTSE 100 were B&M European Value Retail, down 19.2p to 547.8p, Croda International, down 184p to 5,284p, Ashtead Group, down 158p to 5,310p, Tesco, down 7.5p to 256.3p, and Ocado Group, down 21p to 857.8p.