31st Jan 2025 16:54
(Alliance News) - Stock prices in London closed mostly higher on Friday, after FTSE 100 leader Smiths Group pleased investors by announcing spin-offs and an increase to its buyback programme.
The FTSE 100 index closed up 27.08 points, 0.3%, at 8,673.96. The FTSE 250 ended up 145.41 points, 0.7%, at 20,950.48, and the AIM All-Share closed down 0.10 points at 718.13.
The Cboe UK 100 ended up 0.3% at 869.89, the Cboe UK 250 closed up 0.7% at 18,325.33, and the Cboe Small Companies ended slightly lower at 15,932.75.
The US personal consumption expenditure price index rose 2.6% on-year in December, up from 2.4% in November and in line with the FXstreet-cited consensus, the Bureau of Economic Analysis reported.
Core PCE, which excludes food and energy and is the Federal Reserve's preferred inflation gauge, increased by 2.8% on an annual basis in December, unchanged from November. It rose 0.2% on-month, accelerating from November's 0.1% growth.
The Federal Reserve's target for core PCE is 2.0%.
Meanwhile in the UK, Prime Minister Keir Starmer will host German Chancellor Olaf Scholz over the weekend, Downing Street has confirmed. Asked why the prime minister had not said anything specific to mark the half-decade anniversary since the UK left the European Union, Downing Street said that the government is "very much looking forwards".
The two leaders are due to meet on Sunday, and comes as the government is looking to reset its relationship with the EU.
Smiths Group led the FTSE 100, rising 11%.
The London-based engineering firm announced a break-up, alongside plans to increase its share buyback programme to GBP500 million from GBP150 million as it looks to "maximise shareholder value". It plans to sell its electronic connectors business by the end of 2025 and separate its threat detection arm, either by UK demerger or sale.
Earlier this month, US activist investor Engine Capital said Smiths should explore a split, according to a Financial Times report.
"You say jump and I say how high appears to be the response of industrial conglomerate Smiths Group to pressure from activist investor Engine Capital," AJ Bell's Russ Mould said. "Smiths Group says it plans to spin off its Interconnect arm – which makes broadband connection and antenna parts – and Smiths Detection which makes X-Ray machines for airports. In reality, it is unlikely these decisions have been made purely because Engine published a letter a week or so ago.
"These plans have likely been in the works for some time, although whether they have been brought forward is another matter."
Fresnillo was the FTSE 100's worst performer, ending down 2.3%.
John Wood Group led the FTSE 250, up 5.1%. Biggest loser Aston Martin was 2.8% lower.
Among small caps, Alkemy Capital Investments closed up 30%.
The company said its Tees Valley Lithium unit is to team up with Veolia Water Technologies, a unit of Paris-listed Veolia Environnement, "to support the development of TVL's first lithium hydroxide refinery train".
Newmark Security lost 16%.
The workplace safety products and services designer said its pretax loss for the six months that ended October 31 widened to GBP431,000 from GBP126,000 the year before. Revenue for the half-year fell 1.9% to GBP10.2 million from GBP10.4 million.
In European equities on Friday, the CAC 40 in Paris ended down marginally, while the DAX 40 in Frankfurt ended down 0.1%.
Consumer price inflation in Europe's largest economy slowed to 2.3% in January from 2.6% in December, provisional data from the Federal Statistical Office showed. On a monthly basis, consumer prices declined by 0.2%, following a similar 0.2% drop in December.
On a harmonised basis, which allows for EU-wide comparison, annual consumer price inflation picked up to 2.8% in January from 2.6% in December. Core inflation, which excludes food and energy prices, remained at 2.9%.
The pound was quoted lower at USD1.2429 at the London equities close Friday, compared to USD1.2461 at the close on Thursday.
The euro stood at USD1.0393 at the European equities close Friday, lower against USD1.0423 at the same time on Thursday.
Against the yen, the dollar was trading higher at JPY154.85 compared to JPY154.37 late on Thursday.
Stocks in New York were higher at the London equities close, with the DJIA up 15.82 points, the S&P 500 index up 0.7%, and the Nasdaq Composite up 1.3%.
Japanese Prime Minister Shigeru Ishiba will meet with executives of OpenAI and Tokyo-based tech investor SoftBank Group next week, his office said Friday.
Ishiba will meet with SoftBank Chief Executive Masayoshi Son, OpenAI Chief Executive Sam Altman and his co-founder Greg Brockman on Monday.
The report follows news late on Friday morning that OpenAI is in early talks to raise up to USD40 billion in a new funding round led by SoftBank, valuing OpenAI at more than USD300 billion.
Some of the money invested by SoftBank, PA said, may be used to help pay for OpenAI's commitment to Stargate – a US government-backed joint venture between OpenAI, SoftBank and Oracle to invest up to USD500 billion in AI projects and infrastructure to help keep the US ahead of China in the global AI race.
The Canadian economy slowed in November but is expected to have bounced back in December, a report on Friday showed.
According to Statistics Canada, gross domestic product decreased 0.2% in November, the largest monthly contraction since December 2023, following a 0.3% increase in October. Overall, there were broad based declines as 13 of 20 sectors contracted in November.
Statistics Canada said advance information indicates that GDP rebounded in December by 0.2%. GDP is estimated to have expanded 0.4% in the fourth quarter of 2024 and by 1.4% in 2024 as a whole.
Brent oil was quoted at USD75.92 a barrel at the London equities close Friday, down from USD77.18 late Thursday.
Gold was quoted higher at USD2,806.64 an ounce at the London equities close Friday against USD2,793.57 at the close on Thursday.
In Monday's UK corporate calendar, HgCapital Trust releases a trading statement.
The economic calendar for Monday has manufacturing PMI releases from several regions including the US, the UK and the eurozone.
Shanghai markets will remain closed, but Hong Kong will have reopened on Monday.
By Emma Curzon, Alliance News reporter
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