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LONDON MARKET MIDDAY: London stocks underperform peers before US jobs
Stocks in London were in the red at Tuesday midday, while the CAC 40 in Paris and the DAX 40 in Frankfurt were in the green, ahead of US trade balance data.
The FTSE 100 index was down 23.05 points, 0.3%, at 8,226.61. The FTSE 250 was down 98.05 points, 0.5%, at 20,514.60, and the AIM All-Share was down 0.88 points, 0.1%, at 728.07.
The Cboe UK 100 was down 0.3% at 824.19, the Cboe UK 250 was down 0.6% at 17,905.39, and the Cboe Small Companies was down 0.2% at 15,937.28.
JD Sports lead the FTSE 100, up 5.5%, after Bank of America reinitiated the retailer with a ’buy’ recommendation.
Next came second with a 4.4% rise, having said full price sales in the nine weeks to December 28 rose 6.0% on-year. Adjusting for the effect of the end-of-season sale, which ‘flattered’ its out-turn, full price sales were up 5.7% compared with guidance of 3.5% growth.
It now expects pretax profit for the year to January 25 of £1.01 billion, a rise of 10% on-year compared to previous expectations of a 95% increase, and has raised its total group sales target to £6.30 billion from £6.27 billion.
AJ Bell’s Russ Mould said: ‘These figures are a further reminder, as if one were needed, that retailers can thrive, regardless of what the weather does, if they sell the right product at the right price point in the right format for the target customer base.’
He also noted that ‘increased wage costs and national insurance contributions in the coming year are not going to have a seriously detrimental impact’ with Next planning to cover the extra £67 million in costs ‘through a 3.5% increase in full-price sales’.
WPP led the FTSE 100’s laggers, down 3.1% after JPMorgan maintained its ’neutral’ rating but cut the price target to 960 pence from 1,040p.
J Sainsbury lost 2.9%, after research from Kantar showed that while UK grocery sales reached record levels in December, grocery price inflation ticked up to 3.7% - its highest level since March 2024.
Nonetheless, Sainsbury’s market share rose to 16.0% and sales growth of 3.5% outpaced the market which climbed by 2.2%.
Oxford Nanopore led the FTSE 250, up 3.5%, while Raspberry Pi led the laggers with a 6.7% loss.
In smaller caps, Critical Mineral Resources gained 8.3% after saying it was ‘encouraged’ by developments at its commodities trading business.
‘CMR has now undertaken several trades since early December in a range of base and speciality metals. This has led to multiple new trading opportunities and the company now intends to expand this profitable business during 2025,’ it explained.
In European equities on Tuesday, the CAC 40 in Paris was up 0.8%, while the DAX 40 in Frankfurt was up 0.4%.
For the eurozone, annual consumer price inflation accelerated to 2.4% in December, in line with consensus, from 2.2% in November according to Eurostat. On a monthly basis, prices rose 0.4% in December having fallen 0.3% in November.
Annual core consumer price inflation picked up to 2.8% in December, from 2.7% in November, where it had been expected to remain. Core harmonised consumer prices rose 0.5% on-month, compared with a 0.6% fall in prices in November from October.
Separate figures, also from Eurostat, put the seasonally-adjusted unemployment rate at 6.3% of the total civilian labour force in November. This was unchanged from October but outperforming consensus which had predicted a rise to 6.4%.
The pound was quoted at $1.2541 at midday on Tuesday in London, higher compared to $1.2528 at the equities close on Monday. The euro stood higher at $1.0408, against $1.0397. Against the yen, the dollar was trading higher at JP¥157.73 compared to JP¥157.22.
Stocks in New York were called higher. The Dow Jones Industrial Average was called up 0.2%, the S&P 500 index up 0.1%, and the Nasdaq Composite up 0.1%.
Swissquote’s Ipek Ozkardeskaya noted: ‘The US will be releasing its latest jobs figures starting [with the job openings and labour turnover survey reading] today, and the numbers will matter for the Fed expectations...Activity on Fed funds futures suggests that the next Fed cut will not arrive before May. Sufficiently soft figures this week could scale back a part of that hawkishness, pull the US dollar lower and allow the others to gain field.’
There is also an ISM services purchasing managers’ index reading at 1500 GMT, the same time as the job openings read.
Apple, down 0.1% in pre-market trading, has said it will update its artificial intelligence tools after the BBC complained about inaccurate summaries of its headlines being pushed to iPhone users.
Last month the Apple Intelligence features inaccurately summarised a news alert about Luigi Mangione the man accused of killing UnitedHealthcare boss Brian Thompson he had shot himself.
Last week the tools inaccurately summarised a collection of BBC Sport headline notifications, claiming that Luke Littler had won the World Darts Championship Final before it began, and that tennis player Rafael Nadal had come out as gay.
Brent oil was quoted slightly higher at $76.84 a barrel at midday in London on Tuesday from $76.65 late Monday.
Gold was quoted higher at $2,644.95 an ounce against $2,638.63.
Still to come on Tuesday’s economic calendar is the trade balance data, plus job openings and labour turnover from the US.
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