21st Dec 2022 12:13
(Alliance News) - Stocks in Europe were trading higher by midday on Wednesday, with retailers leading the way in London.
The FTSE 100 index was up 63.01 points, 0.9%, at 7,433.63. The FTSE 250 was up 173.01 points, 0.9%, at 18,717.77, and the AIM All-Share was up 2.41 points, 0.3%, at 824.15.
The Cboe UK 100 was up 0.9% at 743.65, the Cboe UK 250 was up 1.1% at 16,193.01, and the Cboe Small Companies was up 0.4% at 12,872.93.
In Paris, the CAC 40 stock index was up 1.0%, while the DAX 40 in Frankfurt was up 0.7%.
Sterling was quoted at USD1.2112, lower than USD1.2139. The euro traded at USD1.0616, edging down from USD1.0627. The dollar was quoted at JPY131.91, up versus JPY131.27.
Stocks in New York were called to open higher. The Dow Jones Industrial Average was called up 0.7%, the S&P 500 index up 0.5%, and the Nasdaq Composite up 0.3%.
There is a consumer confidence survey from the US at 1500 GMT.
In economic news, UK public sector borrowing ballooned in November, according to Office for National Statistics, due the government's energy support schemes and high inflation.
Public sector net borrowing excluding public sector banks jumped to GBP22.0 billion, which was GBP13.9 billion higher than November of 2021. Borrowing reached its highest level for November since monthly records began in 1993, ONS said.
"As the UK economy heads towards a recession, the public purse could suffer a slowdown in tax revenue as businesses and consumers decelerate, which could result in higher public sector borrowing. The chancellor tried to offset some of these pressures in the autumn statement with difficult fiscal choices including spending cuts and tax increases," said interactive investor's Victoria Scholar.
Gold was quoted at USD1,812.45 an ounce midday Wednesday, lower than USD1,814.62 on Tuesday.
In the FTSE 100, JD Sports was the top performer, up 6.0%, in a positive read-across from athleisure goods maker Nike. The US listing was up 12% in the New York pre-market on Wednesday, after late Tuesday reporting strong revenue growth. Nike peer adidas was up 6.9% in Frankfurt.
In other retailing news, there was unexpected rebound in UK sales over the year to December but positivity could be "short-lived" amid continued pressure on budgets, according to new figures.
The Confederation for British Industry's latest monthly survey showed an improvement in sales in the run-up to Christmas. The CBI's headline retail sales balance was positive 9% in December, compared with the same month last year. This was a rebound from a 19% fall in November and came despite predictions of lower sales for the month.
On the London Stock Exchange, Frasers was up 2.7%, and Next added 2.4%.
BP and Shell were up 1.9% and 1.7%, respectively, despite little progress in oil prices. Brent oil fetched at USD80.69 a barrel at midday in London, edging up from USD79.88 late Tuesday.
At the other end of the index, Bunzl lost 1.0%, despite guiding for strong growth in 2022.
Revenue is set to grow 17% year-on-year, or by 10% at constant currency. This is due to "inflation driving underlying revenue growth and the impact of acquisitions further supplementing growth", the distribution services firm said.
Bunzl said its operating margin is expected to be slightly ahead of prior guidance, and will be in line with 2021.
Looking ahead to 2023, Bunzl expects revenue to grow slightly, with adjusted operating profit to be "resilient". Adjusted earnings per share are expected to be "moderately" lower from 2022, however.
"Shares in Bunzl have proven to be relatively resilient to the equity market volatility, inflationary pressures and global supply chain bottlenecks with the stock down a modest 2% year-to-date. Bunzl has offset some of these pressures through higher prices as a vendor of essential items that are hard to cut back on during an economic downturn. It has also been pursuing inorganic growth with a series of acquisitions to supplement growth," noted ii's Scholar.
Housebuilders were higher in midday trade. Persimmon was up 1.6%. Barratt was up 1.5%, and Taylor Wimpey added 1.4%.
This comes as HMRC figures show that UK house sales remained slightly higher than pre-pandemic levels in November. Across the UK, an estimated 107,190 house sales took place in November, which was 13% higher than November 2021.
"Transaction numbers are holding up, particularly as we would expect things to start to slow down as we approach Christmas," commented Mark Harris, chief executive of mortgage broker SPF Private Clients.
"Buyers with good mortgage offers are keen to complete before they expire, while others have to move for whatever reason, even if the market is more difficult than it has been."
On AIM, Thor Mining added 5.8%, after initial drilling results showed high uranium prospectivity at two 100% owned projects in Colorado.
The London-based Australia and US-focused exploration and development company said its recently completed drilling programme confirmed high uranium prospective at both the Wedding Bell and Radium Mountain projects.
The company said drilling results showed 2.1 metres at 0.036% triuranium octoxide at the Groundhog prospect, including 0.3 metres at 0.14% triuranium octoxide.
By Elizabeth Winter, Alliance News senior markets reporter
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