24th Sep 2024 12:13
(Alliance News) - Stock prices in London were mostly higher at midday, with eyes on US consumer confidence data and following a German business morale report suggesting the nation's economy is "in the red".
Earlier on Tuesday stocks had received a boost thanks to stimulus measures in China, although Lloyds analysts downplayed the possible impact of the moves.
China unveiled some of its boldest measures in years as it looks to turbocharge its struggling economy. Among the measures was a cut to the reserve requirement ratio, which dictates the amount of cash banks must hold in reserve.
Lloyds analysts added: "It feels like we've been here before when it comes to headline-grabbing bouts of credit-driven stimulus and yet China's housing slump continues to deepen, and equity markets continue to underperform...With shrinking multipliers from successive previous measures that have soaked the economy in credit maybe this latest initiative should be referred to as a 'sugar rush' rather than a 'bazooka'."
The FTSE 100 index was up 31.81 points, 0.4%, at 8,291.52. The FTSE 250 edged up 11.23 points, 0.1%, at 20,856.35, though the AIM All-Share was down by 0.29 of a point at 744.03.
The Cboe UK 100 was up 0.3% at 828.99, the Cboe UK 250 was marginally higher at 18,362.70, and the Cboe Small Companies was up 0.1% at 16,838.96.
In European equities, the CAC 40 in Paris was 1.6%, while the DAX 40 in Frankfurt was up 0.7%.
Miners lifted the FTSE 100, with Anglo American among the best of the lot, surging 7.0% on the China stimulus news. The developments in China also lifted luxury retail, boost the CAC in Paris. LVMH shot up 3.8%.
German business confidence deteriorated for a fourth straight month in September, a closely watched survey showed, as Europe's largest economy struggles to emerge from the doldrums.
The Ifo institute's confidence barometer, based on a survey of around 9,000 companies, fell to 85.4 points from 86.6 points in August.
Businesses were less satisfied with the current environment and more pessimistic about the months ahead, and confidence among companies in the crucial manufacturing sector in particular fell to the lowest level since June 2020.
The reading was "bad news", said Fritzi Koehler-Geib, chief economist at public lender KfW, and added to signs that the German economy would be "in the red" in the third quarter.
The pound was quoted at USD1.3370 at midday on Tuesday in London, up from USD1.3357 at the equities close on Monday. The euro stood at USD1.1129, down against USD1.1135. Against the yen, the dollar was trading at JPY143.90, up compared to JPY143.77.
Stocks in New York were called higher. The Dow Jones Industrial Average was called up 0.2%, the S&P 500 index is also called 0.2% higher, and the Nasdaq Composite up 0.4%.
Market participants will be focused on the various US releases scheduled for Tuesday afternoon, including comments from "hawkish" US Fed Governor Michelle Bowman.
There is a US house price index reading at 1400 BST, before consumer confidence data at 1500 BST.
As for Bowman, Brown Brothers Harriman analysts commented: "As the only dissent in favour of a 25 basis point cut last week, her comments will lean hawkish. Ahead of the weekend, Bowman said she feared that a jumbo cut sends a 'premature victory' message to the markets. We concur."
On the FTSE 100 in London, 3i Group edged up 0.3%.
The London-based private equity and venture capital company highlighted a "good" performance with "impressive" growth from Action leading the way.
Year-to-date sales, at September 22, of EUR9.3 billion are 21% ahead of the same period last year, 3i remarked. Like-for-like sales growth over the same period was 9.6%, driven by customer transactions and strong sales of everyday necessities.
Elsewhere, AG Barr lost 3.8%.
The Cumbernauld, Scotland-based branded beverage business behind Irn-Bru said revenue increased 5.2% to GBP221.3 million in the six months to July 27, from GBP210.4 million a year prior. Pretax profit however fell 10% to GBP24.9 million from GBP27.8 million.
AG Barr increased its first-half interim dividend by 17% to 3.10 pence per share from 2.65p.
"The last decade has thrown a lot at AG Barr, in the form of new regulations on sugar content, Covid-19, carbon dioxide shortages and input cost inflation (and they are all before the usual issues of competition and changing trends in consumers' tastes), but the Scottish firm's latest set of first-half results suggest it is coping admirably," AJ Bell analyst Russ Mould commented.
Raspberry Pi jumped 8.0%.
The Cambridge-based budget computer firm said pretax profit rose 0.9% to USD10.8 million from USD10.7 million a year prior. Revenue jumped 61% to USD144.0 million from USD89.3 million.
Raspberry Pi said first half profitability was "stronger than expected", and while volumes were marginally lower than predicted, sales were skewed towards "higher margin variants".
It said that having previously expected performance to be weighted towards the second half of the year, "this is no longer the case, with profitability in the first half ahead of internal expectations."
Card Factory slumped 18% as profit fell in its half-year. The greetings cards seller put this down to "
substantial increases in national living wage, plus freight inflation and phasing of strategic investments".
Pretax profit dropped 43% to GBP14.0 million in the six months to July 31, from GBP24.7 million a year prior. Revenue, however, rose 5.9% annually to GBP233.8 million from GBP220.8 million.
Brent oil was quoted at USD75.37 a barrel at midday in London on Tuesday from USD73.80 late Monday. Gold was quoted at USD2,633.97 an ounce against USD2,630.09.
By Emma Curzon, Alliance News reporter
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