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LONDON MARKET MIDDAY: FTSE 100 rises despite weaker US and Asia

14th Nov 2024 12:01

(Alliance News) - Stock prices in London were mostly higher at midday on Thursday as traders await further updates about Donald Trump's incoming US government, as well as producer price inflation and jobless data scheduled today.

On the UK economy, Hargreaves Lansdown's Susannah Streeter commented: "Inflation is likely to have crept back up again [in October] but compared to the scary levels of the last few years, this increase is unlikely to shock...consumers have been showing wariness, sniffing out grocery bargains and still being cautious in terms of big-ticket purchases.

"The Bank of England expects inflation to climb to around 2.75% before the end of the year, but this forecast has already been toned down. If the inflation reading comes in much hotter than predicted, there will be a reassessment of interest rate predictions. At the moment, financial markets reckon it's highly likely that policymakers will press pause on cuts next month."

As for Europe, AJ Bell's Russ Mould noted ongoing "gloom around European companies engendered by the election of a potentially protectionist new Trump administration".

The FTSE 100 index was up 32.34 points, 0.4%, at 8,062.57. The FTSE 250 was up 84.55 points, 0.4%, at 20,443.76, and the AIM All-Share was up 0.44 points, 0.1%, at 729.73.

The Cboe UK 100 was up 0.4% at 810.62, the Cboe UK 250 was up 0.4% at 17,869.98, and the Cboe Small Companies was down 0.4% at 15,847.56.

3i Group was the FTSE 100's second-highest stock, rising 4.7% and close behind Spirax.

The private equity and venture capital company said diluted net asset value per share improved 20% to 2,261 pence as at September 30, while operating profit jumped 22%.

Moreover, 3i proposed an interim dividend of 30.5p, up 15% on-year, and said it has a good pipeline of "high-quality realisations" for the next 12 months.

Burberry was still the FTSE 250's biggest winner, surging 17%, while Keller led the laggers with a 14% drop.

"Burberry was in need of a reset after a very difficult time for the business and the market seems to like the strategy update delivered today by new CEO Joshua Schulman," AJ Bell's Mould commented. "Unsurprisingly Schulman is pulling the cost cutting lever but he has also made new hires in marketing and merchandising and it looks like there will be a greater emphasis on outerwear – an area of traditional strength which presumably could yield higher margin sales."

interactive investor's Richard Hunter meanwhile said Burberry's interim figures "make for difficult reading", warning: "Burberry can only hope that these results represent a line in the sand, and that its revised energy will return it to previous glories.

"It is impossible to estimate how much of its cachet has already been lost, let alone the wider headwinds such as the economic situation in China which continue to be uncertain."

WH Smith was among the laggers, losing 3.6%.

The retailer said full-year pretax profit was GBP106 million post-IFRS 16, falling 3.7% annually, but revenue grew 7.0% to GBP1.92 billion. It also proposed a final dividend of 22.6 pence, up 8.3% year-on-year and giving a total dividend of 33.6p per share.

"Selling travel essentials to captive audiences at airports and rail stations has been a highly lucrative activity for WH Smith...but today's numbers are a reminder the company is not immune to a bit of turbulence along the way," Mould commented.

Elsewhere, Young & Co's gained 3.1%.

The brewer reported a 3.3% annual increase in pretax profit to GBP25.3 million, and revenue surged 27% to GBP250.0 million. It also lifted the interim dividend by 6.0% to 11.53 pence per share.

However, it noted increased near-term costs resulting from the government's budget in October.

In European equities on Thursday, the CAC 40 in Paris was up 1.0%, while the DAX 40 in Frankfurt was up 1.2%.

The pound was quoted at USD1.2653 at midday on Thursday in London, lower compared to USD1.2714 at the equities close on Wednesday. The euro stood lower at USD1.0518, against USD1.0568. Against the yen, the dollar was trading up at JPY155.99 compared to JPY155.24.

Stocks in New York were called higher, having closed mixed on Tuesday. The Dow Jones Industrial Average, the S&P 500 index and the Nasdaq Composite were called to open up 0.1%.

"The FTSE 100 ticked higher in early trading on Thursday despite weakness in the US and Asia overnight as American inflation edged higher," commented Mould. "While the [US] consumer prices reading wasn't alarmingly high, it helped to stoke strong performance for the dollar again."

Asian stocks closed mostly lower, as noted in the open comment, including a 2.0% loss for the Hang Seng index.

Brent oil was quoted higher at USD72.63 a barrel at midday in London on Thursday from USD72.32 late Wednesday.

Gold was quoted lower at USD2,549.62 an ounce against USD2,591.88.

Still to come on Thursday's economic calendar is the PPI and unemployment data from the US. There will also be evening comments from European Central Bank President Christine Lagarde, and from Bank of England Governor Andrew Bailey.

By Emma Curzon, Alliance News reporter

Comments and questions to [email protected]

Copyright 2024 Alliance News Ltd. All Rights Reserved.

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