Britain’s FTSE edges lower

AFP

AFP

Published May 20, 2015

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London - Britain's top share index edged lower in choppy trade on Wednesday, weighed down by a hefty drop in luxury goods maker Burberry after it gave a lower outlook for 2016, although M&A talk around Vodafone supported the market.

While Burberry beat forecasts with its full-year profit report, it cut retail and wholesale profit guidance for 2016 due to foreign exchange movements and said it was seeing increased uncertainty in some markets, sending its shares down 5 percent lower.

“Better than expected figures... (but) it's the outlook that is dominating,” Alastair McCaig, market analyst at IG, said. “Currency headwinds are playing their part... and continue to look to be problematic.”

The FTSE 100 index was down 0.1 percent at 6,986.20 by 08h06 GMT, 1.9 percent off an all-time high hit in late April.

Vodafone gained 3.3 percent, its best day since January, recovering from the previous session's slide.

Traders cited comments from Liberty Global chairman John Malone, who said that Vodafone would be a “great fit” with Liberty.

“The scope for a tie-up with Liberty Global is adding to support here,” Tony Cross, market analyst at Trustnet Direct, said in a note.

Vodafone had dropped 3.2 percent on Tuesday after reporting results, with some traders saying guidance was slightly below expectations.

Marks & Spencer dropped 1 percent, despite returning to profit for the first time in 4 years and posting results above consensus expectations.

Traders said that much of the good news was already priced in after a rally of over 20 percent so far in 2015.

Reuters

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