30th Dec 2022 09:07
(Alliance News) - Stock prices in London opened the last trading day of the year lower on Friday, but the FTSE 100 index has fared better than other blue-chip indices in Europe in 2022 as a whole.
The FTSE 100 index opened down 32.0 points, 0.4%, at 7,480.72. The FTSE 250 was down 25.18 points, 0.1%, at 18,971.27, and the AIM All-Share was down 3.12 points, 0.4%, at 833.33.
The Cboe UK 100 was down 0.4% at 747.83, the Cboe UK 250 was down 0.1% at 16,440.03, and the Cboe Small Companies was down 0.1%. at 13,174.22.
The FTSE 100 looks set to close 2022 down just 0.4%, whereas the midcap FTSE 250 is on course to shed 21% and the AIM All-Share 31%.
"The FTSE 100 is more of an outward-looking global index that does not reflect the fundamentals of the UK economy. Not only has it outperformed the FTSE 250, but it has also out-shined its European equivalents such as the DAX in Germany and the CAC in France thanks to its favourable sectoral mix," interactive investor's Victoria Scholar explained.
In European equities on Friday, the CAC 40 in Paris and the DAX 40 in Frankfurt were both down 0.6%. In the year-to-date, they are down 9.5% and 13% respectively.
The London Stock Exchange will close early at 1230 GMT on Friday.
Trading is likely to be subdued as the festive period wraps up, with little in the way of economic or company news to provide much direction.
London and other global markets, including New York and Tokyo, will be closed on Monday to observe New Year's Day.
Sterling was quoted at USD1.2061 early Friday, firm on USD1.2057 at the London equities close on Thursday. The euro traded at USD1.0658 early Friday, edging down from USD1.0661 late Thursday. Against the yen, the dollar was quoted at JPY132.14, down versus JPY133.31.
In Asia on Friday, the Japanese Nikkei 225 index ended flat. In China, the Shanghai Composite rose 0.5%, while the Hang Seng index in Hong Kong added 0.3%. The S&P/ASX 200 in Sydney closed up 0.3%.
Wall Street had rallied on Thursday, with the Dow Jones Industrial Average ending up 1.1%, the S&P 500 up 1.8% and the Nasdaq Composite 2.6% higher.
UK house prices fell for the fourth month in a row this month, according to building society Nationwide, marking the worst run since the financial crisis of 2008.
In December, house prices fell 0.1% on a monthly basis, easing from a monthly fall of 1.4% in November. On an annual basis, house prices rose 2.8% in December, slowing from growth of 4.4% the month before.
The average UK house price stood at GBP262,068 in December, down from GBP263,788 a month before.
"While financial market conditions have settled, mortgage rates are taking longer to normalise and activity in the housing market has shown few signs of recovery," said Nationwide Chief Economist Robert Gardner.
"It will be hard for the market to regain much momentum in the near term as economic headwinds strengthen, with real earnings set to fall further and the labour market widely projected to weaken as the economy shrinks."
FTSE 100-listed housebuilders edged down in early trade, with Persimmon, Barratt and Taylor Wimpey all down 0.5%. Property portal Rightmove also shed 0.5%.
Retailers were doing better, however. JD Sports added 2.0%, the top performer, and Next rose 1.3%.
Next will be the first UK retailer to release a post-Christmas trading update next Thursday.
"Last we heard, Next expects sales to be down 2% for the full financial year amid a backdrop of changing consumer spending habits. The past few weeks will be a crucial pillar of that, and we're keen to see that trading hasn't been worse than expected. Recent UK figures show that retail parks have been faring better than high streets, which could hold Next in good stead," said Hargreaves Lansdown's Sophie Lund-Yates.
Also providing Christmas trading updates on Thursday next week will be B&M European Value Retail and bakery chain Greggs. They were up 0.5% and down 0.7%, respectively, on Friday.
Gold was quoted at USD1,1817.47 an ounce early Friday, higher than USD1,811.91 on Thursday, while Brent oil fetched at USD83.73 a barrel, up from USD82.78.
On AIM, Nexus Infrastructure surged 33%, as it announced it has agreed to dispose of TriConnex Ltd and eSmart Networks Ltd for GBP77.7 million in cash.
The infrastructure services provider said around GBP65 million of the sale proceeds will be returned to shareholders in early 2023 via a tender offer.
After the transaction, Tamdown will be its principal trading business.
CEO Mike Morris and Chief Financial Officer Alan Martin will leave their roles and will be employed by the purchaser, with Charles Sweeney to become CEO, and Dawn Hillman to become CFO. A general meeting is set for January 16 to vote on the transaction.
Moving in the oppositive direction on AIM was Harland & Wolff, down 23%.
The firm said material shortages have affected its ability to complete "certain key workstreams" of the M55 regeneration programme contract, meaning around GBP20 million in revenue will be deferred into the first half of 2023.
"Whilst it is unfortunate that the company could not advance these workstreams to book revenues in 2022, the overall project is still on track and in line with the base redelivery schedule for the vessel," the infrastructure construction firm said.
H&W also said it has mutually agreed with Saipem to terminate a wind turbine generator jacket contract. This is due to cost escalations, which the firm has not found a "mutually acceptable methodology" to split with Saipem.
"Management has determined that the capacity in Methil could be far better utilised on more economically viable projects, which are expected to come to fruition in H1 2023 onwards," it said.
Saipem shares were down 1.0% in Milan early Friday.
By Elizabeth Winter, Alliance News senior markets reporter
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