Shares in Rolls-Royce hit turbulence as a mid-flight problem with one of its latest jet engines forced an Airbus A350 into an emergency landing, sparking fears that design flaws may be more widespread than first thought.
The aerospace engineer had previously hailed the ‘excellent’ reliability of its XWB suite of engines, but an Iberia flight from New York to Madrid had to divert to Boston after one of the two engines shut down 90 minutes after take-off.
Rolls’ Trent 900 and 1000 engines have also been plagued by technical troubles of late, with repair work on those expected to dent this year’s profits by £450m.
Investors, concerned about the possibility of another costly round of repairs, pushed the eject button, sending the shares down 4 per cent. They later recovered to close 1.1 per cent lower, or 10.6p, at 964.4p.
Helped by a slew of green among the heavyweight oil and mining stocks, the FTSE 100 closed up 0.55 per cent, or 39.82 points, at 7313.36. The FTSE 250 also finished in positive territory, rising 0.76 per cent, or 154.11 points, to 20,380.53, led by housebuilder Galliford Try, up 10.5 per cent, or 105p, to 1104p, and homeware retailer Dunelm, up 11.9 per cent, or 60.5p, to 570.5p, after both released full-year results that were greeted positively.
Retailers were among those boosting the Footsie as fashion stores rode higher on the coat-tails of Spain’s rag-trade giant Zara. That was after the fast- fashion chain’s owner, Inditex, controlled by Europe’s richest person, Amancio Ortega, said its latest collections had been ‘well-received’ by customers as it forecast a rise in second-half sales of up to 6 per cent. Marks and Spencer rose 1.5 per cent, or 4.4p, to 293.3p, while Next, which has half-year results out this month, climbed 0.8 per cent, or 44p, to 5468p. Superdry zipped 0.9 per cent higher, or 10p, to 1158p.
Preventing the blue-chip index from moving higher were the energy groups, which fell to the bottom of the leaderboard as a profit warning from SSE spooked investors in the sector.
The Scotland-based company, which supplies electricity and gas up and down the UK, blamed the wrong type of summer weather as it warned that operating profits will be almost £200m below what it expected.
The stock fell 8.3 per cent, or 103.5p, to 1147p dragging with it sector peers National Grid, down 0.63 per cent, or 5.1p, to 802.80p and British Gas owner Centrica, which dipped 3.6 per cent, or 5.4p, to 144.35p.
Down on junior market AIM, upmarket estate agent M Winkworth was in demand as it reported a pick-up in rental activity in its core London market.
Record numbers of renters are registering in the capital, and Winkworth expects that to continue as more people are priced out of buying their own home.
Perhaps more importantly, it reckons sales volumes, which have fallen due to Brexit uncertainty and higher stamp duty fees, are unlikely to slide further.
Shares closed 14.7 per cent higher, or 16p, at 125p.
London’s biggest faller was also to be found among the small caps.
Trakm8 Holdings dropped after the telematics and data supply firm warned that it had had a weak start to the current financial year. The stock price fell 20.3 per cent, or 15p, to 60p.
That was in stark contrast to Mycelx Technologies, which gushed 40.7 per cent higher, or 55p, to 190p after it posted a sharp rise in first-half revenue and earnings.
It uses its tech to help oil and gas companies remove hydrocarbons from water, and saw revenues more than double to £9.3m from £4.5m last year, while the firm’s earnings surged to £2.1m from £229,000.