14th Jan 2025 09:02
(Alliance News) - Stock prices in London opened higher on Tuesday ahead of important US producer price inflation data due this afternoon.
"Markets' sensitivity to major economic data will likely rise as policy uncertainties mount and appetite weakens," commented Swissquote's Ipek Ozkardeskaya. "Due today, the US will release its latest PPI numbers, and the headline PPI may have risen from 3% to 3.4% in December and core PPI is seen rising from 3.4% to 3.7% during the same month.
"Rising price pressures are not good news for the Federal Reserve doves, she continued. "Stronger-than-expected inflation figures could further accelerate the US treasury selloff and support the US dollar."
The FTSE 100 index opened up 3.33 points at 8,227.52. The FTSE 250 was up 81.33 points, 0.4%, at 19,799.70, and the AIM All-Share was up 2.75 points, 0.4%, at 712.14.
The Cboe UK 100 was flat at 824.65, the Cboe UK 250 was up 0.4% at 17,184.54, and the Cboe Small Companies was up 0.3% at 15,204.05.
On the FTSE 100, JD Sports lost 9.9%.
"JD Sports is tanking this morning after a sales miss and a cut to profit guidance, reflecting ongoing external challenges in a volatile market, Hargreaves Lansdown's Matt Britzman explained. "While footwear and international segments performed well, core UK/USA operations lagged, prompting management to cut revenue and profit guidance.
"The retail powerhouse has been pushing on with expansion plans into what looks like a difficult market, and with performance starting to dip, there will no doubt be question marks around that strategy."
JD Sports now expects between GBP915 million and GBP935 million in pretax profit for financial 2025. Also, it said like for like revenue decreased 1.5% on-year through November and December.
Games Workshop was down 2.7%.
The Warhammer owner declared a GBP1.55 per share interim dividend, bring the financial 2025 total so far to GBP4.20 per share, up from GBP3.15 the year before.
Pretax profit increased to GBP126.8 million from GBP95,2 million, while revenue rose to GBP299.5 million from GBP247.7 million.
However Games Workshop declared and paid 185p per share in dividends during the period, down annually from 195p.
Persimmon gained 5.1%.
The housebuilder said completions increased 7.5% on-year to 10,664 in 2024, and its forward sales position increased 8.5% to GBP1.15 billion from GBP1.06 billion.
Also, it expects underlying pretax profit "to be around the upper end of market expectations", which range from GBP349 million to GBP390 million. This compares to an underlying pretax profit of GBP359.4 million Persimmon had reported for 2023, albeit this was a dive of 65% from GBP1.01 billion in 2022.
"Looking ahead, the order book is in a healthy position at an impressive GBP1.1 billion, giving decent near-term revenue visibility," said Hargreaves Lansdown's Aarin Chiekrie. "The potential of rising build cost inflation had been an area of concern heading into these results, but the low single-digit outlook for 2025 is a challenge that Persimmon should be able to navigate with ease."
On the FTSE 250, Crest Nicholson rose 2.0%.
The housebuilder announced a revised date for the publication of its preliminary financial results for the year ended October 31, which will now be released on February 4 instead of January 21.
It said it still expects adjusted pretax profit at the lower end of the GBP22 million to GBP29 million guidance range, down from GBP41.4 million in financial 2023.
The date change follows a request from its auditors for more time "to complete standard procedures and audit the appropriateness of the fire remediation provision".
Among smaller caps, Hutchmed (China) gained 2.8%.
It announced that the supplemental new drug application for Orpathys or savolitinib has been granted approval by the China National Medical Products Administration to treat adults with locally advanced or metastatic non-small cell lung cancer.
In European equities on Tuesday, the CAC 40 in Paris was up 1.1%, while the DAX 40 in Frankfurt was up 0.7%.
The pound was quoted higher at USD1.2224 early on Tuesday in London, compared to USD1.2161 at the equities close on Monday. The euro stood higher at USD1.0270, against USD1.0209. Against the yen, the dollar was trading lower at JPY157.52 compared to JPY157.66.
"The EURUSD remains under a decent selling pressure below the 1.03 mark, while Cable is in a freefall mode on another round of appetite loss in the government's fiscal plans and amid rising bets for a further selloff," Ozkardeskaya said. "Positions in the options market suggest that some investors are betting that sterling could slip to 1.12 level against the US dollar if Rachel Reeves can't restore confidence rapidly."
In Asia on Tuesday, the Nikkei 225 index in Tokyo was down 1.8%. In China, the Shanghai Composite was up 2.5%, while the Hang Seng index in Hong Kong was up 1.9%. The S&P/ASX 200 in Sydney closed up 0.5%.
In the US on Monday, Wall Street ended mixed, with the Dow Jones Industrial Average up 0.9%, the S&P 500 up 0.2% and the Nasdaq Composite down 0.4%.
Brent oil was quoted lower at USD80.10 a barrel early in London on Tuesday from USD81.25 late Monday.
Gold was quoted higher at USD2,672.99 an ounce against USD2,666.56.
Still to come on Tuesday's economic calendar, as well as the PPI data the US releases the Redbook index reading.
By Emma Curzon, Alliance News reporter
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