15th May 2025 08:58
(Alliance News) - London stocks opened in the red on Thursday, as data reveals the UK economy beat expectations for growth in the first quarter of 2025, while the goods and services trade deficit narrowed further.
The FTSE 100 index opened down 46.59 points, 0.5%, at 8,538.42. The FTSE 250 was down 65.09 points, 0.3%, at 20,754.48, and the AIM All-Share was down 2.07 points, 0.3%, at 729.55.
The Cboe UK 100 was down 0.3% at 852.95, the Cboe UK 250 was down 0.2% at 18,164.83, and the Cboe Small Companies was down 0.2% at 15,892.72.
According to the Office for National Statistics, UK gross domestic product is estimated to have grown by 0.7% in the quarter from January to March. This is accelerated from a 0.1% growth in the prior quarter and outperforms an FXStreet-cited consensus for 0.6% growth.
This was driven by a 0.7% rise in the services sector and a 1.1% increase in production, noted the ONS. The construction sector showed no growth.
On-year, GDP in the first quarter was up 1.3%, beating a 1.2% FXStreet consensus. It slowed from 1.5% on-year growth in the fourth quarter of 2024.
Separate figures from the ONS on Thursday also showed the total goods and services trade deficit narrowed by GBP3.6 billion to a deficit of GBP6.6 billion in the three months to March.
The trade in goods deficit narrowed by GBP4.3 billion to GBP55.2 billion in the first quarter, while the trade in services surplus is estimated to have narrowed by around GBP700 million to GBP48.6 billion.
Imports from non-EU countries fell by GBP600 million, or 2.5%, while imports from the EU increased by GBP200 million, or 0.9%. Exports of goods to the US increased for its fourth consecutive month with a GBP2.4 billion rise in the first quarter. Imports of goods from the US rose GBP1.3 billion.
In European equities on Thursday, the CAC 40 in Paris was 0.4% lower, while the DAX 40 in Frankfurt was also down 0.4%.
The pound was quoted down at USD1.3279 early on Thursday in London, compared to USD1.3302 at the equities close on Wednesday. The euro stood lower at USD1.1198, against USD1.1208. Against the yen, the dollar was also trading lower, at JPY145.82 compared to JPY146.43.
UK industrial output fell 0.7% in March, numbers from the Office for National Statistics showed on Thursday, against a 1.7% rise in February and a 0.4% decline in January. This fell short of an FXStreet-cited consensus for a 0.5% decline.
On-year, the 0.7% decline in March outperformed an FXStreet-cited consensus for a 0.9% fall. On-quarter, ouput rose 1.1% in the three months to March, in the first quarterly rise since the beginning of 2024.
National Grid was the FTSE 100's biggest winner at market open on Thursday, up 2.3%.
National Grid is a London-based electricity and gas utility that operates the UK's national electricity grid, as well as the electricity and gas distribution system in the US state of New York.
The firm reported pretax profit of GBP3.65 billion for its financial year that ended March 31, rising 20% from GBP3.05 billion the year before. This was despite revenue declining 7.4% to GBP18.38 billion from GBP19.85 billion, as other operating costs were reduced by 13% to GBP13.24 billion from GBP15.21 billion.
The group declared a total dividend of 46.72 pence per share, down 20% on-year from 58.52p. Earnings per share declined 8.1% to 60.0p from 55.5p, while capital investment increased 20% to GBP9.85 billion from GBP8.24 billion.
National Grid targets an asset compound annual growth rate of around 10% over the next five years to financial 2029, as well as an underlying EPS compound annual growth rate of 6% to 8%. The firm aims to reach around GBP60 billion in capital investment over the next five years, too.
Serco Group was the FTSE 250's leader at market open, rising 6.4%.
The multinational defence, health, space, justice, migration, customer services and transport company has been awarded three contracts by the UK Ministry of Defence cumulatively totalling more than GBP1 billion, to provide maritime services for the Royal Navy.
This includes an around GBP850 million contract spanning ten years for the delivery of in-port services for HMNB Devonport in Plymouth, HMNB Portsmouth and for the Clyde, including HMNB Faslan.
Another contract, valued at around GBP70 million, involves the provision of inshore support to military training and exercises over five years, while the final ten-year contract, valued at around GBP110 million, is for the provision of offshore support to military training and exercises.
At the other end, Eco Buildings Group tumbles 41%.
The manufacturer of prefabricated modular housing products has raised gross proceeds of GBP670,000 via a placing of 16.8 million new shares at 4 pence each. This included a GBP250,000 direct subscription by one new subscriber.
Funds from the placing will be used to fund the purchase of additional capital equipment and to fund working capital, specifically a further manufacturing line at the group's existing site.
Eco Buildings has also agreed to issue warrants as part of the placing, on a basis of 1 warrant for every 2 placing shares, to be exercised at a price of 13p each within the next three years.
In Asia on Thursday, the Nikkei 225 index in Tokyo was 1.0% lower. In China, the Shanghai Composite fell 0.7%, while the Hang Seng index in Hong Kong faded 1.0%. The S&P/ASX 200 in Sydney closed 0.2% higher.
In the US on Wednesday, Wall Street ended mixed, with the Dow Jones Industrial Average down 0.2%, the S&P 500 improving 0.1% and the Nasdaq Composite rising 0.7%.
Brent oil was quoted lower at USD64.02 a barrel early in London on Thursday from USD66.01 late Wednesday.
Gold was quoted down at USD3,132.66 an ounce against USD3,184.56.
Still to come on Thursday's economic calendar, eurozone industrial production plus US PPI, retail sales and industrial production figures.
By Emily Parsons, Alliance News reporter
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