Lloyds results bolster index as Sainsbury’s slumps

THE FTSE 100 ended higher yesterday as a strong set of results from Lloyds helped the index shake off a bleak day for Sainsbury’s shares.

London’s top flight closed the day up 49.45 points, or 0.69 per cent, at 7,228.62, also aided by optimism over trade tensions between the US and China.

Fiona Cincotta, analyst at City Index, said: “President [Donald] Trump seems for the time being to have softened his stance on the deadline for a deal on the Sino-us trade talks, infusing global markets with a light helping of optimism.” Lloyds was flying higher after posting an increase in annual profits as it delivered a bumper £4 billion pay-out for shareholders and said it will meet cost targets earlier than expected.

The banking giant also shrugged off concerns about the impact of Britain’s departure from the European Union.

Lloyds booked pre-tax profits of £5.96bn for 2018 compared with £5.28bn the previous year, helped by lower charges for payment protection insurance (PPI) compensation.

Shares rose towards the top of the FTSE 100, closing up 2.76p, or 4.75%, at 61.13p.

At the other end of the spectrum, Sainsbury’s shares were pummelled after the competition watchdog all but killed its proposed £12bn merger with rival Asda.

The Competition and Markets Authority said it could block the deal unless the pair sell off significant stores or even one of the brands.

It found “extensive” concerns over their planned tie-up, warning it could lead to higher prices and reduce quality and choice for shoppers across the UK.

Shares in Sainsbury’s closed down 53.4p, or 18.6%, at 234.5p. ON the second tier, Intu came in for a hammering after the shopping centre giant swung to an annual loss after a collapse in the value of its properties.

The company, which owns Manchester’s Trafford Centre and Gateshead’s Metrocentre, made a £1.17bn loss in 2018 compared with £227.2 million pre-tax profit the previous year.

This came as the company saw £1.4bn wiped off the value of its property portfolio to £9.2bn. Shares dropped 9.2p at 108.95p, a fall of over 7%.

The pound, meanwhile, was trading flat versus the US dollar at 1.306 at the London market close. Against the euro, sterling was also flat at 1.150.

David Madden, market analyst at CMC, said: “The splits in both Labour and Conservative parties this week has shaken British politics, and that fear factor is playing out in the currency markets.”

In Europe, Germany’s DAX was up 0.9% and France’s CAC 40 was up 0.68%. A barrel of Brent crude was changing hand at $67, an increase of 1%.

THE biggest risers on the FTSE 100 were Wood Group up 29.8p at 542.8p, GVC up 34p at 649p, Kingfisher up 12.4p at 241.6p and Antofagasta up 45.4p at 935.4p.

THE biggest fallers on the FTSE 100 were Sainsbury’s down 53.4p at 234.5p, Morrisons down 12.8p at 227.25p, Hikma down 41.5p at 1,673.5p and London Stock Exchange down 95p at 4,508p. US stocks ended higher yesterday after minutes from the Federal Reserve’s last meeting reaffirmed for investors that the central bank would be “patient” with respect to further interest rate hikes.

But policymakers gave little sense of how long their “patient” stance on the rate policy would last, according to minutes from the January 29-30 meeting, resulting in jumpy afternoon activity and stocks trading on both sides of unchanged.

“The minutes largely echoed the Fed’s cautious statement from its last meeting,” said Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington.

“I get the sense that rates are on hold until later this year . ... But the Fed stopped well short of closing the door to a rate hike later this year if the downside growth risks subside.”

Policymakers also promised “before too long” a plan for their $4 trillion balance sheet, the minutes showed.

Southwest Airlines Co slipped 5.7 per cent after the carrier said it would take a $60 million hit from the partial U.S. government shutdown.

The carrier dragged down shares of other airlines, sending the Dow Jones US Airlines index down 2.6%.

The Dow Jones Industrial Average rose 63.12 points, or 0.24%, to 25,954.44, the S&P 500 gained 4.94 points, or 0.18%, to 2,784.7 and the Nasdaq Composite added 2.30 points, or 0.03%, to 7,489.07.