- UK growth in line with expectations
- German IFO survey misses forecasts
- RBS, Tullow, G4S lead markets higher
techMARK 2,637.10 -0.20%
FTSE 100 6,715.80 +0.04%
FTSE 250 15,462.54 -0.41%
Markets were rangebound on Friday morning as investors adopted a cautious approach heading into the weekend after the FTSE 100 hit a fresh five-month high the day before.
There was little reaction to third-quarter UK gross domestic product (GDP) growth figures today which came in as expected by analysts. The UK economy expanded at a quarter-on-quarter rate of 0.8% in the July to September period, a slight pick-up from the 0.7% growth registered in the second quarter.
According to analyst Blerina Uruçi from Barclays, the pace of expansion in GDP was "solid" and the strongest quarterly growth since the second quarter of 2010. Uruçi highlighted comments from the Monetary Policy Committee (MPC) which said at its October meeting that unemployment would be lower, and outgrowth growth faster, in the second half than expected at the time of the August Inflation Report.
"This raises risks that policy tightening might begin sooner than had been indicated in the August Inflation Report [...] although we would not expect it to be a dramatic revision," the analyst said.
London's FTSE 100 was broadly flat by midday, trading within a narrow range after hitting 6,713.18 on Thursday afternoon, a level not seen since May 28th. This morning, just 16 points separated the index's intraday low (6,704) and high (6,720).
Limiting upside on markets today was the German IFO survey for October which showed that confidence declined slightly among that business executives for the first time in six months. The business climate index fell to 107.4 in October from 107.7 compared to a consensus estimate of 108.
The focus now turns to economic data In the US: Durable goods orders for September will likely rise by 2% compared to August when it increased 0.1%, analysts predict; while the final October reading of the University of Michigan consumer confidence index is expected to slip to 75 from the initial estimate of 75.2.
Banks, oil stocks provide a lift
Domestic banking stocks were performing well this morning with RBS, Lloyds and Barclays making gains.
RBS was higher after leading investors urged Chancellor George Osborne not to go ahead with a 'good bank-bad bank' split of the part-nationalised lender. Meanwhile, reports that the initial public offering of its US subsidiary Citizens Financial could come sooner than expected also gave the stock a boost.
Oil and gas stocks were on the up this morning with Tullow Oil, BG Group and Premier Oil among the best performers. Tullow yesterday announced plans to offer $500m in senior notes to repay certain existing debts.
BSkyB was in the red after analysts at Macquerie downgraded their rating on the pay-TV and broadband provider from 'outperform' to 'neutral'. They said that the company could face competition from telecoms group BT over rights to broadcast the Champion's League.
Security solutions group G4S was a high riser this morning after HSBC upgraded the stock to 'neutral' and hiked their target price from 205p to 250p. The company also announced this morning that its UK Chief Executive Richard Morrison is being replaced by Chief Operating Officer Eddie Ashton.
Speciality chemicals group Elementis also rose saying it delivered a "resilient performance" for the three months ended September 30th and saw a return to more normal trading patterns in oilfield drilling.
Closed life fund group Phoenix gained after revealing it is on track to hit the top end of its 2013 cash generation target range following a strong financial performance in recent months.
FTSE 100 - Risers
Tullow Oil (TLW) 984.50p +2.66%
Royal Bank of Scotland Group (RBS) 365.50p +2.52%
G4S (GFS) 257.80p +1.90%
Fresnillo (FRES) 1,041.00p +1.86%
ARM Holdings (ARM) 975.50p +1.56%
SSE (SSE) 1,443.00p +1.48%
Barclays (BARC) 270.20p +1.41%
GlaxoSmithKline (GSK) 1,616.50p +1.22%
BG Group (BG.) 1,253.50p +1.05%
WPP (WPP) 1,337.00p +0.91%
FTSE 100 - Fallers
British Sky Broadcasting Group (BSY) 928.50p -2.26%
International Consolidated Airlines Group SA (CDI) (IAG) 356.00p -2.20%
Hargreaves Lansdown (HL.) 1,163.00p -1.86%
Intertek Group (ITRK) 3,289.00p -1.67%
Vedanta Resources (VED) 1,070.00p -1.65%
Standard Life (SL.) 366.00p -1.59%
easyJet (EZJ) 1,328.00p -1.48%
Weir Group (WEIR) 2,313.00p -1.32%
GKN (GKN) 371.30p -1.30%
Burberry Group (BRBY) 1,527.00p -1.29%
FTSE 250 - Risers
Elementis (ELM) 257.80p +5.53%
Imagination Technologies Group (IMG) 290.50p +3.23%
Premier Oil (PMO) 345.70p +3.22%
Polymetal International (POLY) 621.00p +2.39%
Go-Ahead Group (GOG) 1,741.00p +2.35%
Phoenix Group Holdings (DI) (PHNX) 793.00p +2.32%
Computacenter (CCC) 562.00p +2.09%
Fisher (James) & Sons (FSJ) 1,103.00p +1.94%
Drax Group (DRX) 669.00p +1.90%
Eurasian Natural Resources Corporation (ENRC) 225.00p +1.81%
FTSE 250 - Fallers
AZ Electronic Materials SA (DI) (AZEM) 265.30p -5.92%
NMC Health (NMC) 346.00p -4.16%
Pace (PIC) 307.80p -2.53%
Great Portland Estates (GPOR) 583.50p -2.42%
Dixons Retail (DXNS) 47.14p -2.36%
Evraz (EVR) 125.50p -2.33%
Berkeley Group Holdings (The) (BKG) 2,386.00p -2.29%
Taylor Wimpey (TW.) 110.90p -2.29%
Barratt Developments (BDEV) 333.70p -2.11%
RPS Group (RPS) 283.20p -2.11%