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LONDON MARKET MIDDAY: FTSE 100 as shakes off pre-interest rate nerves

18th Mar 2024 11:49

(Alliance News) - Stock prices in London were higher at midday Monday, as eyes were firmly on interest rate decisions across the globe.

Amongst individual stocks, Marshalls lost out on a profit warning. Reckitt Benckiser edged higher after a big sell off on Friday.

The FTSE 100 index was up 21.69 points, 0.3%, at 7,749.11. The FTSE 250 was up 33.85 points, 0.2%, at 19,546.76, and the AIM All-Share was down 1.29 points, 0.2%, at 737.02.

The Cboe UK 100 was up 0.2% at 775.52, the Cboe UK 250 was up 0.4% at 16,968.64, and the Cboe Small Companies was up 0.1% at 14,767.94.

In European equities on Monday, the CAC 40 in Paris was up 0.1%, while the DAX 40 in Frankfurt was up 0.2%.

All eyes have been on interest rate decisions from across the globe.

Japan has notably caught headlines overnight. Major Japanese media and economists are now betting that the Bank of Japan will drop its negative interest rate policy.

The central bank is scheduled to start a two-day policy board meeting on Monday, with Governor Kazuo Ueda's press conference scheduled for Tuesday afternoon.

Citing "sources close to the matter", the Japan Times said the BoJ's policymakers have the requisite confidence that a "virtuous cycle" of wage growth and price hikes is taking place.

Investor focus is also on the US Federal Reserve, which will make its interest rate decision on Wednesday. Investors will be keen to find out when the US monetary policymakers are likely to start cutting rates.

The Bank of England will announce its own interest rate decision the following day. Markets are expecting the bank to keep interest rates unchanged, with focus on the future trajectory.

"At one time, this week would have been pegged as the point at which central bankers in the US and UK pivoted to rate cuts but although that is now unlikely, the meetings of the Federal Reserve and Bank of England will still be watched closely for signals of when this pivot might finally come," said AJ Bell's Russ Mould.

There has also been focus on some economic data from the eurozone.

Eurostat said the yearly harmonised consumer price inflation cooled to 2.6% in February, from 2.8% in January. This was in line with a previous estimate.

On a monthly basis, prices rose 0.6% in February from January, after easing 0.4% in January from December.

Eurostat also published trade data on Monday.

According to a first estimate, the eurozone had a EUR11.4 billion surplus in trade in goods with the rest of the world in January, compared with a deficit of EUR32.6 billion a year earlier.

Exports over the year rose by 1.3% to EUR225.9 billion. Imports fell by 16% to EUR214.5 billion.

The pound was quoted at USD1.2738 at midday on Monday in London, higher compared to USD1.2735 at the equities close on Friday. The euro stood at USD1.0904, up against USD1.0889. Against the yen, the dollar was trading at JPY149.10, up compared to JPY149.04.

In the FTSE 100, Reckitt Benckiser edged up 2.3%, after a big sell-off on Friday.

Reckitt on Friday said it "stands by the safety of our products" and will pursue all options to overturn a USD60 million verdict handed by an Illinois jury.

BP rose 0.8% and Shell edged up 0.6% on the back of higher oil prices.

Brent oil was quoted at USD85.78 a barrel at midday in London on Monday, up from USD85.33 late Friday.

In the FTSE 250, Bytes Technology fell 9.2%.

Bytes Technology said it had launched an investigation into former chief executive Neil Murphy's share dealings after revealing he had failed to disclose a huge number of trades in company shares.

Back in February, Murphy resigned after disclosing to the BTG board a number of undisclosed trades in company shares.

On Monday, BTG explained the resignation followed a voluntary request for information from the UK Financial Conduct Authority, sent to Murphy on February 14. The RFI indicated that Murphy may have conducted additional transactions that were not disclosed to the market or the FCA.

Marshalls shed 7.2%.

The Elland, England-based landscaping products maker said pretax profit dived 40% to GBP22.2 million in 2023 from GBP37.2 million in 2022, as revenue contracted 6.7% to GBP671.2 million from GBP719.4 million.

The company cut its final dividend by 42% to 5.7 pence per share from 9.9p a year prior, reducing the total payout to 8.3p from 15.6p.

Marshalls said that revenue in the first two months of 2024 was lower than in 2023 and reflects the continued weakness seen in the second half of last year.

On the other hand, Chemring rose 6.6%.

The Hampshire, England-based provider of technology products and services to aerospace, defence and security markets said its Norwegian subsidiary, Chemring Nobel, received awards totalling GBP57 million.

Funding has been allocated as part of the EU's act in support of ammunition production programme following the European Council's call in March 2023 to deliver ammunition to Ukraine while simultaneously helping member states replenish their stockpiles.

Aston Martin jumped 7.0%. Bank of America raised the company's stock rating to 'buy'.

Stocks in New York were called mixed. The Dow Jones Industrial Average was called down 0.1%. Meanwhile, the S&P 500 index called up 0.4% and the Nasdaq Composite up 0.8%.

Gold was quoted at USD2,159.62 an ounce, down against USD2,162.90.

Still to come on Monday's economic calendar, there is Canada's producer price index.

By Sophie Rose, Alliance News senior reporter

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