Britain’s FTSE falters

UK shares dip on Thursday after a disappointing earnings outlook from Travis Perkins and a caution from Anglo American.

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London - UK shares dipped on Thursday after a disappointing earnings outlook from Travis Perkins, caution from Anglo American and as a number of companies traded without dividends.

Britain's benchmark FTSE 100 was down 16.67 points, or 0.3 percent at 6,331.75 points by 08h23 GMT, underperforming European indexes, with companies going ex-dividend taking off 8.9 points, according to Reuters calculations.

Investors were wary ahead of a European Central Bank meeting in Malta at which it is expected to send a strong message reinforcing its readiness to boost monetary stimulus if needed.

“My sense is (the ECB is) probably not going to do anything, but ... just in case they throw a curveball, people are holding back on any positions until we're through it,” CMC Markets analyst, Jasper Lawler, said.

Anglo American fell 3.4 percent after it said that it was postponing major project investment decisions at its platinum unit until at least 2017 and had cut diamond production in the face of weak demand.

Travis Perkins, the owner of DIY stores Wickes and heating supplies group BSS, was the biggest FTSE faller, down 7.8 percent after saying that its full-year earnings would be at the lower end of market expectations.

Educational publisher Pearson also struggled, losing nearly 3 percent after several broker downgrades.

Its shares set a record one-day loss of 16 percent on Wednesday after saying that lower enrolments at some US colleges and a decline in school textbook purchases in some parts of South Africa would hit full-year results.

“The most concerning thing for us about Pearson's weak nine-month update is how little visibility they seemed to have at 1H results on 24th July,” Barclays analysts wrote in a note.

“It is hard to see this share price fall as an opportunity.”

REUTERS