London midday: Stocks pare gains as investors digest data

Wed 30 Aug 2017

LONDON (SHARECAST) - (ShareCast News) - London stocks were up but off earlier highs by midday as investors digested the latest figures on consumer credit and mortgage approvals, shrugging off concerns about North Korea.
The FTSE 100 was up 0.3% to 7,356.72, while the pound was up 0.1% against the dollar at 1.2924 and 0.3% firmer versus the euro at 1.0818, recovering after it sank against the single currency on Tuesday amid frustration in the latest Brexit talks.

Analysts attributed the calmer tone in markets in part to US President Trump's measured response to North Korea's missile launch over Japan, but IG's Joshua Mahony said it was probably too early to celebrate, with indices already off their morning highs.

"The Korean situation is not going away, and once August is out of the way thoughts will turn to the upcoming debt ceiling situation in the US. Yesterday's bounce could easily be a reflex action, without much to carry it forward over the longer-term. As we head into the autumn, equity markets face a series of challenges, not the least of which are the Fed and ECB's policy direction. It is unlikely to be a smooth ride to the end of the year."

In economic news, bank lending figures from the Bank of England painted a mixed picture for households and businesses, with a further reduction in consumer credit but a rise in mortgage approvals and business lending.

Consumer credit growth eased to its lowest rate in a year and its second lowest in three years at 9.8% as the July flow was a little weaker than recent months.

Net consumer credit in July surprisingly fell to 1.2bn from 1.4bn, the Bank revealed, when an increase to 1.5bn had been forecast.

Mortgage approvals increased to 68,689 from a weaker few months to the levels seen at the beginning of the year, well up from 65,318 the previous month and higher than the 65.5K consensus expectation.

Still to come, investors will also be eyeing the release of second-quarter US GDP at 1330 BST, while the ADP employment report at 1315 BST will be watched ahead of Friday's non-farm payrolls.

On the corporate front, broadcaster ITV was bouncing back from heavy losses in the previous session, when it was hit by a revenue warning from German peer ProSiebenSat.1.

Rental equipment firm Ashtead was also on the front foot, with traders pointing to a possible boost from the rebuild following Hurricane Harvey in the US.

Ocado rallied on the back of an initiation at 'buy' at Citigroup while JD Sports was boosted as Barclays reiterated its 'overweight' rating on the stock.

Diploma was in the black after saying it had continued to trade well in the second half of the year and remained on track to post full year results in line with expectations.

WH Smith edged higher after saying results for the year to the end of August should hit target and that it continues to see further opportunities for international growth in via the airport market, while Petrofac was marginally higher as it reported a jump in first-half pre-tax profit but rebased its dividend.

Hansteen Holdings advanced as it announced the sale of Carvers Trading Estate in Ringwood, north east of Bournemouth on Wednesday for 7.06m, reflecting a net initial yield of 4.93% and a capital value per square foot of 137.

James Fisher reversed course to trade higher after posting a rise in first-half underlying operating profits and lifting its dividend.

Going the other way, Spectris was in the red after saying it will sell its Microscan Systems unit to Omron Corporation for $157m in cash.

Dunelm was hit by the resignation of its chief executive for "personal reasons" and HSS Hire tanked after the tool and equipment hire company warned that year-on-year revenue growth in the current quarter will see a "materially lower" level of improvement than expected at the start of the first half.

Market Movers

FTSE 100 (UKX) 7,356.72 0.26%
FTSE 250 (MCX) 19,596.10 0.35%
techMARK (TASX) 3,375.14 0.38%

FTSE 100 - Risers

ITV (ITV) 158.10p 3.33%
Sainsbury (J) (SBRY) 236.90p 2.69%
Ashtead Group (AHT) 1,632.00p 2.32%
Paddy Power Betfair (PPB) 6,785.00p 1.80%
BAE Systems (BA.) 600.00p 1.69%
Hammerson (HMSO) 565.50p 1.34%
Rolls-Royce Holdings (RR.) 909.00p 1.34%
Associated British Foods (ABF) 3,256.00p 1.24%
GlaxoSmithKline (GSK) 1,516.00p 1.17%
Barratt Developments (BDEV) 617.00p 1.15%

FTSE 100 - Fallers

Mediclinic International (MDC) 742.00p -1.66%
easyJet (EZJ) 1,187.00p -1.58%
Informa (INF) 680.00p -0.95%
Lloyds Banking Group (LLOY) 63.31p -0.85%
Johnson Matthey (JMAT) 2,775.00p -0.79%
AstraZeneca (AZN) 4,456.50p -0.78%
Provident Financial (PFG) 899.50p -0.77%
St James's Place (STJ) 1,163.00p -0.77%
WPP (WPP) 1,411.00p -0.70%
Anglo American (AAL) 1,344.00p -0.70%

FTSE 250 - Risers

Diploma (DPLM) 1,089.00p 5.93%
Ocado Group (OCDO) 303.70p 4.15%
JD Sports Fashion (JD.) 315.50p 4.02%
Fisher (James) & Sons (FSJ) 1,594.00p 3.78%
Unite Group (UTG) 691.50p 3.75%
Bodycote (BOY) 964.00p 3.60%
Evraz (EVR) 313.90p 3.43%
Vesuvius (VSVS) 586.50p 2.53%
Auto Trader Group (AUTO) 350.20p 2.25%
Hansteen Holdings (HSTN) 133.00p 2.07%

FTSE 250 - Fallers

Acacia Mining (ACA) 205.30p -4.69%
Dunelm Group (DNLM) 574.50p -3.93%
Carillion (CLLN) 45.60p -3.41%
Dixons Carphone (DC.) 175.90p -2.17%
Nostrum Oil & Gas (NOG) 375.00p -2.09%
Sophos Group (SOPH) 488.90p -2.08%
IG Group Holdings (IGG) 652.50p -2.03%
Sanne Group (SNN) 759.00p -2.00%
Petra Diamonds Ltd.(DI) (PDL) 93.20p -1.89%
Hochschild Mining (HOC) 281.40p -1.88%
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