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LONDON MARKET MIDDAY: FTSE 100 down despite Halma jumping 10%

13th Jun 2024 12:05

(Alliance News) - Stock in Europe headed lower on Thursday at midday, as markets digest the latest interest rate decision from the US Federal Reserve.

The FTSE 100 index was down 40.98 points, 0.5%, at 8,174.50. The FTSE 250 was down 146.28 points, 0.7%, at 20,351.12, and the AIM All-Share was down 1.59 points, 0.2%, at 785.77.

The Cboe UK 100 was down 0.7% at 814.10, the Cboe UK 250 was down 1.1% at 17,782.64, and the Cboe Small Companies was down 0.1% at 16,761.33.

In European equities on Thursday, the CAC 40 in Paris was down 1.2%, while the DAX 40 in Frankfurt was down 1.1%.

The US Federal Reserve on Wednesday signalled that there could be just one interest rate cut this year, backpedalled from previous predictions. Back in March, the Fed's dot plot implied four cuts.

Also on Wednesday, the US Bureau of Labor Statistics reported that the year-on-year consumer price inflation rate cooled to 3.3% in May from 3.4% in April. According to FXStreet, markets were expecting another 3.4% increase.

"Fed chair Jerome Powell didn't give a huge amount away, although it felt telling that he was fairly cautious about the cooler than expected inflation figures from earlier in the day. The central bank is clear that it wants further signs inflation is on the path to the magic 2% level before it is prepared to start cutting rates. One major sticking point being the continued tight labour market conditions," said AJ Bell's Russ Mould.

Stocks in New York were called to open mixed. The Dow Jones Industrial Average was called down 0.4%, the S&P 500 index flat, and the Nasdaq Composite up 0.5%.

The pound was quoted at USD1.2780 at midday on Thursday in London, lower compared to USD1.2836 at the equities close on Wednesday. The euro stood at USD1.0802, down against USD1.0848.

Against the yen, the dollar was trading at JPY157.17, much higher compared to JPY155.77.

"The Japanese yen edged lower against a basket of major currencies in the early session, as the market widely anticipates that the Bank of Japan (BoJ) will maintain its current interest rates in its upcoming policy decision on Friday," said Daniel Takieddine at BDSwiss.

In the FTSE 100, Halma surged 10% to the top of the index.

The Buckinghamshire, England-based safety equipment maker said pretax profit jumped 17% to GBP340.3 million in the financial year ended March 31 from GBP291.5 million a year prior, as revenue climbed 9.8% to GBP2.03 billion from GBP1.85 billion.

The company noted sound overall demand for its products and services, with the Environmental & Analysis sector delivering "very strong revenue growth" in the photonics business, and supported by Water Treatment and Analysis.

Environmental & Analysis revenue surged 19% to GBP658.4 million from GBP552.1 million.

Halma recommended a final dividend of 13.20 pence per share, up 7.0% from 12.34p a year prior. This brings the total payout to 21.61p, up 7.0% from 20.20p.

BT Group edged up 2.9%

Grupo Financiero Inbursa SAB de CV, the Mexico City-based investment vehicle of multi-billionaire Carlos Slim has bought a 3.2% stake in BT, crossing that ownership threshold on Thursday last week, according to a stock exchange disclosure on Wednesday.

Among his many business interests, Slim is chair of America Movil, which has telecommunications operations throughout Latin America.

In the FTSE 250, Crest Nicholson lost 8.7%, after it slashed its interim dividend.

Crest Nicholson reported a GBP30.9 million pretax loss for the six months to April 30, swung from a GBP28.4 million profit a year before.

Revenue decreased 8.9% to GBP257.5 million from GBP282.7 million, as home completions decreased 12% to 788 from 894.

Crest Nicholson declared a 1.00p per share interim dividend, down 82% from the 5.50p it returned for first half of last year.

The Surrey, England-based housebuilder also announced that former chief executive officer Peter Truscott will step down from its board on Friday, having served since 2019.

Amongst London's small caps, PayPoint added 6.9%.

The Welwyn Garden City, Hertfordshire-based store payment service provider said that in the financial year that ended March 31, pretax profit rose 13% to GBP48.2 million from GBP42.6 million the previous year.

Revenue increased by 83% to GBP306.4 million from GBP167.7 million reflecting the first full year since the company acquired the Love2shop business.

PayPoint said it will launch a three-year share buyback programme that will return a minimum of GBP20 million to shareholders over the next 12 months with potential increases, it said, depending on performance, market conditions, cash generation, and the general capital needs of the business.

On AIM, Trident Royalties jumped 20%, after it agreed a GBP144 million takeover approach from industry peer, Deterra Global Holdings.

The cash bid values each share in Trident, the diversified mining royalty company, at 49 pence each. The offer represents a 23% premium to Trident's closing share price of 40p on Wednesday.

Brent oil was quoted at USD82.01 a barrel at midday in London on Thursday, down slightly from USD82.07 late Wednesday. Gold was quoted at USD2,319.10 an ounce, down against USD2,326.83.

Still to come on Thursday's economic calendar, at 1330 BST, there is the weekly US initial jobless claims data, as well as a producer price reading.

By Sophie Rose, Alliance News senior reporter

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