Britain’s FTSE outperforms EU amid Italian deficit woes

By Julien Ponthus

LONDON, Sept 28 (Reuters) – UK shares were only slightly lower in morning trading on Friday while bourses on the continent sustained steeper losses after the Italian government set a higher than expected budget deficit target that could put Rome on a collision course with Brussels.

The blue chip FTSE 100 was down 0.1 percent at 0823 GMT while the benchmark Euro zone index STOXX 50 was losing 0.8 percent and the Milan stock market 2.4 percent.

“The FTSE actually didn´t do too badly after the bell”, wrote Connor Campbell, an analyst at Spreadex, noting that “the UK index is only a handful of points away from 7550, and looks set to end September at a 4 week peak”.

The FTSE is currently on course to post a monthly 1.3 percent gain.

Financials weighed the most with RSA Insurance Group falling 8 percent after it reported an underwriting loss of about 70 million pounds ($91.43 million) in the third quarter due to bad weather, large losses and claims.

Britain’s insurers have taken a beating from a run of volatile weather, with the hottest summer in living memory following a blast of icy weather earlier in the year dubbed the “Beast from the East”.

Easyjet shares were only slightly up, rising 0.3 percent after forecast annual profit at the upper end of expectations, as it benefited from robust flight demand and cancellations at bigger rival Ryanair in 2018.

“Good numbers from EasyJet, with profits for the full year seen at the top end of guidance, but doubts about 2019 have weighed on the stock this morning”, wrote Neil Wilson, chief market analyst at Markets.com.

Shares in Britain’s United Utilities edged 0.1 percent lower after it said it expected underlying operating profit and revenue for the first half of the year to be higher, even as it promised to reduce leakages and improve service while controlling prices.

Ireland’s Smurfit Kappa added 0.8 percent. Europe’s biggest packaging group announced it would deconsolidate its Venezuelan arm following its temporary seizure by the state last month, resulting in a 60 million euro ($69.73 million) write down in net assets.

Amid smaller companies, British outsourcing company Serco was a top performer with a 15.6 percent rise as it reported full-year profit and revenue above market expectations. ($1 = 0.7656 pounds) ($1 = 0.8605 euros) (Reporting by Julien Ponthus Editing by Raissa Kasolowsky)