Wednesday, July 24: The FTSE 100(-0.73%) edged lower alongside European counterparts at the open with negative outlooks & earnings reports weighing on a number of names. Mining stock held back the FTSE 100 as the world’s largest iron ore producer Vale prepared to resume operations at its Vargem Grande complex, sending iron ore prices lower. Rio Tinto(-4.56%) was hit hardest, though Anglo American(-1.91%) & BHP Group(-1.91%) also closed in the red.
Aston Martin(-23.60%) slid lower as it cut its annual guidance due to a weaker trading environment. Wholesale volumes were previously expected in the 7,100-7,300 range for 2019, but this was moderated to 6,300-6,500 and representative of little progress made over the prior year(2018: 6,441). Sales for the first half were 6% higher at 2,442 vehicles, though sales growth slowed through the course of Q2. Aston Martin also took a £19m provision against consultancy income recognised in Q2 2018, with the commercial position of the contract noted as deteriorating with significant doubt remaining over the outstanding receivable. The company guided towards an adjusted EBITDA margin of c.20% alongside an adjusted operating margin of c.8% and capital expenditure of £300m, a downgrade from 24%, 13% and £320-340m respectively.
ITV(+6.57%) provided respite to shareholders after a fairly weak start to 2019. The broadcaster updated the market and outlined that the business had performed better than expected after noting that its advertising revenue fall in the first half was less drastic than expected due to strong viewership figures for ITV’s Love Island. Advertising revenue slipped 4.6% to £849m from £890m a year ago, while non-advertising revenue was at 6.1% lower at £900m.
European equities were mixed at the close, with the FTSE 100 -0.73%, the CAC 40 -0.22% and the DAX 30 +0.26%.