13th Mar 2025 16:58
(Alliance News) - The FTSE 100 failed to hold early gains, closing little changed, amid fresh weakness on Wall Street after mixed inflation data, and the threat of further tariffs in Europe.
The FTSE 100 index closed up just 1.59 points at 8,542.56. The FTSE 250 dropped 197.94 points, 1.0%, at 19,688.57, and the AIM All-Share fell 1.46 points, 0.2%, at 679.46.
The Cboe UK 100 rose 0.1% at 853.16, the Cboe UK 250 closed down 0.9% at 17,150.25, while the Cboe Small Companies climbed 1.6% at 15,361.46.
In New York at the time of the London close, the Dow Jones Industrial Average and S&P 500 were down 1.1% while the Nasdaq Composite was 1.5% lower.
Figures showed US wholesale inflation stagnated in February, although details for the Fed’s preferred inflation gauge were less favourable.
According to the Bureau of Labor Statistics, the producer price index increased 3.2% in February from a year before, easing from a 3.7% annual advance in January.
January's price growth was upwardly revised from 3.5%.
The February reading was shy of the FXStreet-cited market forecast, which expected a chunkier 3.3% rate of producer price inflation.
On a monthly basis, producer prices were flat in February, but had been expected to rise 0.3%. In January, prices rose 0.6% from December, an outcome upwardly revised from an initially reported 0.4% rise.
The data comes before the next Federal Reserve decision on Wednesday, where the Fed is expected to leave the federal funds rate target range at 4.25%-4.50%.
But Capital Economics noted while final demand and core PPI both surprised to the downside in February, the price increases in the components which matter for the PCE deflator were on the whole hotter than anticipated.
The PCE deflator is the Federal Reserve's preferred inflation measure.
On Wednesday, consumer price inflation figures came in a touch softer-than-expected although the make-up also suggested likely upward pressure on the Fed's preferred prices gauge.
Bank of America said: "Given today's PPI report and yesterday's CPI data, we are tracking core PCE to rise by 0.3% on-month in February. We see risk that the print could round up to 0.4% month-on-month. If our forecast is correct, inflation will take a step in the wrong direction. The 3-month, at 3.3%, 6-month, at 3.0% and annual, at 2.7%, rates would all increase relative to last month."
"This would indicate progress on inflation continues to stall and reinforces our call for the Fed to remain on hold," BofA added.
The latest tariff spat saw Donald Trump threaten to impose 200% tariffs on wine, champagne and other alcoholic products from France and other EU countries in retaliation against the bloc's planned levies on US-produced whiskey.
On Wednesday, the EU unveiled tariffs countering US moves on steel and aluminium, hitting some USD28 billion of US goods in stages from April.
On Thursday, the US president renewed his criticism of the bloc, singling out a 50% levy on US whiskey as being "nasty."
Shares in Johnnie Walker owner Diageo fell 0.2% in London. In Paris, Pernod Ricard fell 4.0% while Campari slid 4.4% in Milan.
China called for "dialogue" with Washington to resolve spiralling trade tensions that have seen the world's two largest economies impose a slew of tariffs on each other's imports.
"China has always advocated that China and the US should adopt a positive and cooperative attitude towards differences and controversies in economic and trade fields," commerce ministry spokeswoman He Yongqian told a weekly news conference.
"But it must be stressed that any form of communication and consultation must be based on mutual respect, equality and mutual benefit," she said.
In European equities on Thursday, the CAC 40 in Paris fell 0.6%, while the DAX 40 in Frankfurt declined 0.5%.
The pound was quoted lower at USD1.2957 late on Thursday in London, compared to USD1.2978 at the equities close on Wednesday. The euro stood at USD1.0874, lower against USD1.0914. Against the yen, the dollar was trading lower at JPY147.65 compared to JPY148.32.
On the FTSE 100, gold miner Endeavour Mining climbed 2.1% as the gold price hit a new record high.
The yellow metal was trading at USD2,982.53 an ounce at the time of the London close on Thursday against USD2,935.01 on Wednesday, in sight of the USD3,000 an ounce landmark.
Halma rose 1.3% after a well received trading update.
Amersham, England-based Halma, which makes safety equipment products, raised its full-year margin outlook, although it cautioned the strength in sterling will be a negative headwind to full-year results.
It now expects an adjusted earnings before interest and tax margin modestly above 21% for the full year to March, compared to prior guidance of around 21%.
UBS said: "Halma continues to showcase the resilience of its business model, combining defensive organic growth with M&A (and now some margin improvement). We expect slight, 1% to 2%, consensus upgrades on the back of the update. We therefore see the recent 10% pull-back in shares as an attractive entry point and reiterate our buy rating."
On the FTSE 250, Volution jumped 12% after it increased its dividend and raised its annual guidance following a "strong" first half which saw adjusted profit grow and sales rise.
The Crawley, England-based energy efficiency and indoor air-quality solutions firm said adjusted pretax profit rose 10% to GBP38.6 million in the six months ended January 31 from GBP35.0 million a year before with an adjusted operating profit margin of 22.7%, up from 22.4%.
Chief Executive Ronnie George said it was a "strong performance".
George said Volution expects full year adjusted earnings per share to be ahead of the 30.8 pence consensus reflecting the "good momentum" going into the second half, ongoing growth initiatives, a focus on efficiency and costs, and the benefits that recent acquisition Fantech is bringing to the group.
But the owner of Bulmers cider, C&C, plunged 19% after it warned earnings would miss expectations after soft trading in January and February amid a cautious consumer backdrop.
C&C, which also sells Tennent's lager, said the macroeconomic environment and UK October budget have impacted consumer confidence.
"The macroeconomic environment and UK October budget have placed a degree of additional pressure on our hospitality customers and impacted consumer confidence more generally," the firm said.
Elsewhere, DFS Furniture jumped 10% after raising its forecast for the full year, now expecting underlying pretax profit of GBP25 million to GBP29 million. It said this was "as a result of the continued strong trading, good cost control and assuming no further supply chain disruption".
Chief Executive Officer Tim Stacey said: "We are on track to deliver full year profit performance ahead of market expectations and our confidence in the group's capabilities and future potential has never been higher."
Brent oil was quoted lower at USD70.13 a barrel in London on Thursday, from USD70.87 late Wednesday.
Friday's economic calendar sees UK GDP figures at 0700 GMT and German, French and Spanish CPI data at 0800 CET, 0845 CET and 0900 CET respectively. The US Michigan consumer sentiment index is due at 1000 EDT.
Friday's UK corporate calendar sees a trading statement from housebuilder Berkeley Group and full-year results from Vanquis Banking Group.
By Jeremy Cutler, Alliance News reporter
Comments and questions to [email protected]
Copyright 2025 Alliance News Ltd. All Rights Reserved.
Related Shares:
DiageoHalmaDfs FurnC&C GroupVolution Group PLSEndeavour Mining