FTSE 100 Risers and Fallers: LSE surges, while Fresnillo leads pack down

The blue-chip index is heading towards a 2% decline this week, with Mexican-based miner Fresnillo dragging the benchmark lower, while London Stock Exchange Group did its best to prop up the Footsie.

The FTSE 100 will end the week down 2% this week to 7,402 points as of 16:05 GMT, with the index seeing its early gains eroded, driven by a sharp share price decline in Mexico-based miner Fresnillo.

FTSE 100 Fallers

Fresnillo helped drag the FTSE 100 lower this week, with the mining company’s stock losing more than 22% of its value this week after it posted a disappointing set of half-year results.

The Mexico-based miner saw its profit for the six months to June 30 fall by 69% compared to the same period last year to $70.9 million.

Last month, the mining company slashed its output forecast, blaming construction delays in Mexico and lower quality ore for the downgrade.

‘As we previously disclosed in our second quarter production report, continued challenges at our Fresnillo, Saucito and Herradura mines, combined with higher costs, have impacted profitability for the period,’ Fresnillo CEO Octavio Alvidrez said.

‘We expect to see a gradual improvement in the following quarters, albeit not at the rate we had anticipated,’ he added.

Fresnillo’s share price closed at £6.11 on Friday, after opening at £7.96 at the start of the week.

British property development and investment firm Hammerson and UK-based wealth manager St James's Place also had a tough week, with them both seeing their stocks slide 21% and 12% respectively.

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FTSE 100 Risers

The London Stock Exchange Group (LSEG) did its best to support the Footsie this week, with the exchange operator agreeing a $22 billion deal to buy Eikon-owner Refinitiv.

The deal, which will bolster LSEG’s presence in the US market and give it a platform to expand into Asia, helped send its share price soaring more than 20% this week, with its stock rising by over 60% in the last 12 months.

The all-share deal gives LSEG full control of Refinitiv, with its Eikon terminals on trading floors capable of posing a threat to those offered by rival Bloomberg.

‘The acquisition of Refinitiv is transformational,’ LSEG CEO David Schwimmer said. ‘It is a rare and compelling opportunity to combine two world class businesses and create a global financial infrastructure leader. We will continue to be a global business headquartered in the UK.’

‘LSEG has been prepared for whatever may come through Brexit,’ he added. ‘We are already diversified across regions and by currencies. This transaction helps us become more global. This is not about Brexit.’

Other notable risers this week include online food delivery service Just Eat, British medical equipment manufacturer Smith & Nephew and British-Swedish drug maker AstraZeneca. The trio saw their share prices rally more than 15%, 5% and 4% respectively this week.

Just Eat continues to see gains following its merger talks with Amsterdam-based rival Takeaway.com. If the planned tie-up goes ahead, subject to regulatory approval, it will create the world’s largest online food delivery platform, with it operating in 20 countries including the UK, Germany, the Netherlands and Canada.

‘The key feature of the combination of Just Eat and Takeaway.com is the limited geographic overlap between the companies,’ Edison Investment Research analyst Russell Pointon said in a note to investors. ‘Therefore, there will be limited consolidation of market shares in their combined markets.’

‘The companies would share best practice and know how etc. to help improve profitability to invest further behind their less profitable markets and fund the fights for market share in what is likely to be a very competitive market,’ he added.


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