Britain's FTSE pinned back by weak corporate reports

Thu Jul 24, 2014 4:31am EDT

Related Topics

* FTSE 100 down 0.2 pct

* Consumer staples lead fallers after Unilever disappoints

* Kingfisher and easyJet also fall after updates

* German PMI prompts recovery after poor French survey

EDINBURGH, July 24 (Reuters) - UK shares fell on Thursday, pegged back by a spate of poor corporate updates which knocked the top British share index down through a key technical level.

The FTSE 350 Food Producers Index was the heaviest sectoral faller, down 1.7 percent after earnings in the sector missed expectations.

Consumer products group Unilever fell 2 percent after slowing emerging markets and stagnant developed markets saw the firm miss sales estimates.

Mid-cap sweetener maker Tate & Lyle also fell 2 percent after missing expectations for adjusted operating profit.

In all, consumer staples firms took 4.5 points off the FTSE 100, with was down 15.65 points, or 0.2 percent, at 6,782.50 by 0805 GMT.

Outside of the sector, airline easyJet fell 4.1 percent after guiding that profit would grow between 14 percent to 19 percent on Thursday, tempering market forecasts set at the top end of the range.

Alastair McCaig, analyst at IG, said events such as the World Cup may have affected people's holiday patterns and believed the performance over the rest of the summer would be strong.

"The strength of the pound makes taking a holiday that much cheaper, and there's optimism that they might see a much more impressive second half of the summer," McCaig said.

Top faller was home improvement retailer Kingfisher, which slumped 7.1 percent after saying its European trading had been worse than expected, especially in France and Poland.

"After warning back in May that profit growth will be slower than expected, this does not sit well with traders who now have eyes on an interim statement in September. They should expect the worst," James Abbott, Trader at Accendo Markets, said.

A survey on Thursday showed further evidence of a weak French economy, with a decent performance in the services sector counteracted by weakness in manufacturing and concerns that sentiment may slide over the coming months.

While better than expected PMI data out of Germany helped shares rise off their early lows, the FTSE remains below the 6,800 level which had held as support in the previous two sessions before the morning's fall. (Reporting by Alistair Smout; Editing by Hugh Lawson)

FILED UNDER: