Stormy morning for FTSE

After six positive days, it is a very stormy morning for the FTSE 100. A 0.5% fall somewhat underplays how rough it really is for some of the big names today. 

Starting at the bottom and working up, Tate & Lyle (-17%) and Rolls-Royce (-11%) are two companies really suffering this morning, as they both provided disappointing outlooks as part of their results releases. A rating-cut for Aberdeen Asset Management causes it to fall 5%, and a read across to the weak Rolls-Royce numbers has pushed BAE Systems 3% lower ahead of its update, a week from today. 

Lloyds (-4%), regularly IG’s most traded stock in London, has also slumped this morning, despite finally returning to a pre-tax profit and pushing the idea of a dividend towards the end of the year. The bank is clearly declaring its readiness to return to full private ownership, but investors may be put off by the 'ball is in your court' approach that Lloyds is taking towards UK Financial Investments, which controls the taxpayers' stake in the firm. Clarity on the government's disposal plans would certainly help give a better long-term picture, with some analysts highlighting that offloading the remaining 33% stake in one hit may be the best way to go. In the meantime, we still expect to see buyers on weakness around the 80 pence level, as short-term opportunities around this level have borne fruit so far in 2014. 

Ahead of US trading we are eyeing a negative start, after a lacklustre close yesterday and following European weakness this morning. Our opening call of 15,915 for the Dow Jones is lower by around 50 points. 

IGA, may distribute information/research produced by its respective foreign marketing partners within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.