- ECB speculation picks up after weak GDP
- LSE jumps after strong annual results
- Aviva, Old Mutual disappoint with earnings
- Thomas Cook leads travel sector lower
techMARK 2,781.23 -0.42%
FTSE 100 6,889.08 +0.15%
FTSE 250 15,857.35 -0.73%
UK stocks were fluctuating at 14-year highs on Thursday morning as investors paused for breath amid a flurry of corporate earnings and some mixed economic data.
The FTSE 100 was trading up 0.2% at 6,889 by midday, having swung between gains and losses during the morning session. The index closed at 6,878.49 on Wednesday, a level not seen since the last trading day of 1999 when it hit a record 6,930.20.
Eurozone gross domestic product (GDP) growth was a lacklustre 0.2% in the first quarter, unchanged from the preceding quarter but under analysts' forecasts of a 0.4% expansion, prompting calls for the European Central Bank (ECB) to inject stimulus into the single-currency region at its policy meeting next month.
These hopes were reinforced this morning by a subdued final reading of consumer price inflation for the region in April, which was left unchanged at 0.7%.
"While the ECB will likely retain the view that moderate recovery is developing, the disappointing first quarter GDP performance increases the risk that demand will not be strong enough to prevent inflation remaining below 1.0% for a prolonged period," according to Howard Archer, Chief European & UK Economist at IHG Global.
Asian markets finished in a mixed fashion overnight with Tokyo's Nikkei closing in the red despite GDP growth in Japan surging to 5.9% in the first quarter, up from just 0.3% growth in the fourth quarter of 2013 and well ahead of forecasts. The pick-up in growth was most likely due to a consumer buying spree ahead of a sales-tax hike which began in April, so "is likely that we will see subsequent weakness in the second quarter", according to Joshua Mahony, Research Analyst at Alpari.
The US consumer price inflation is also also due out in the States later on, with markets also on the look-out for jobless claims data, a reading of regional manufacturing in New York and nationwide industrial production figures.
LSE gains, Aviva drops
LSE rose strongly after it reported a 10% rise in annual revenue to £1.1bn helped by the acquisition of LCH.Clearnet business. While profits fell on the back of higher expenses due to the purchase, the company said it has identified significant cost savings as part of the integration.
Insurer Aviva was headed the other way as it underwhelmed with a "reassuring calm and stable" first quarter, with the value of new business growing solidly despite weather and regulatory developments.
Old Mutual was also lower after first-quarter gross sales growth was limited to just 12% due to adverse currency movements. Growth would have been 24% at constant currencies.
Tour operator Thomas Cook reduced earnings losses in the first half of the year, but revenues contracted as disruption in Egypt continued to weigh, causing shares
to sink sharply today. Investec said that UK summer trading "gives us a cause for concern" at Thomas Cook given that a strong summer is needed from the company if it is to meet the market's profit forecasts. Others in the travel sector such as IAG and easyJet also dropped.
Markets gave a cool reaction to Dixons and Carphone Warehouse's announced £3.8bn 'merger of equals' after months of talks. The new company, to be named Dixons Carphone plc, is hoped to create a "world-class British retailer for the new digital age".
Oil explorer Tullow Oil fell despite a positive update on drilling at its joint-owned Blocks 10BB and 13T in northern Kenya with Africa Oil.
Meanwhile, real estate investment trust Land Securities also failed to please despite saying it is well positioned in a strong property market, amid robust valuation gains and an almost fully-let retail portfolio.
Vodafone's shares were under pressure after Goldman Sachs cut the stock from 'buy' to 'neutral' and reduced its target from 270p to 240p ahead of the telecom's fourth-quarter results due out next week. Meanwhile, UBS kept a 'buy' rating, but lowered its target from 275p to 255p.
FTSE 100 - Risers
Fresnillo (FRES) 863.00p +3.17%
London Stock Exchange Group (LSE) 1,845.00p +2.44%
Morrison (Wm) Supermarkets (MRW) 200.80p +2.29%
HSBC Holdings (HSBA) 628.60p +1.80%
Tesco (TSCO) 301.35p +1.70%
Sports Direct International (SPD) 774.00p +1.51%
IMI (IMI) 1,599.00p +1.40%
Antofagasta (ANTO) 805.00p +1.26%
Schroders (SDR) 2,646.00p +1.11%
GlaxoSmithKline (GSK) 1,641.00p +1.08%
FTSE 100 - Fallers
International Consolidated Airlines Group SA (CDI) (IAG) 372.20p -4.29%
easyJet (EZJ) 1,594.00p -4.09%
St James's Place (STJ) 764.00p -2.92%
Tullow Oil (TLW) 858.00p -2.89%
Aviva (AV.) 516.50p -2.82%
Old Mutual (OML) 203.60p -2.77%
Ashtead Group (AHT) 815.50p -2.34%
Land Securities Group (LAND) 1,080.00p -2.26%
ITV (ITV) 175.10p -2.23%
Aberdeen Asset Management (ADN) 420.10p -2.21%
FTSE 250 - Risers
Xaar (XAR) 819.00p +6.78%
Infinis Energy (INFI) 209.00p +3.41%
Foxtons Group (FOXT) 322.90p +3.33%
Polymetal International (POLY) 586.00p +2.90%
Kier Group (KIE) 1,693.00p +2.86%
Ferrexpo (FXPO) 152.90p +2.76%
NMC Health (NMC) 481.50p +1.93%
Evraz (EVR) 106.80p +1.71%
Laird (LRD) 287.90p +1.37%
F&C Commercial Property Trust Ltd. (FCPT) 119.50p +1.27%
FTSE 250 - Fallers
Thomas Cook Group (TCG) 166.60p -6.72%
Dixons Retail (DXNS) 48.07p -5.56%
Carphone Warehouse Group (CPW) 315.90p -3.63%
Entertainment One Limited (ETO) 300.00p -2.79%
Premier Farnell (PFL) 221.10p -2.60%
Centamin (DI) (CEY) 62.35p -2.50%
Inmarsat (ISAT) 707.00p -2.35%
Grafton Group Units (GFTU) 585.00p -2.34%
RPS Group (RPS) 295.00p -2.32%
Howden Joinery Group (HWDN) 327.20p -2.27%