London close: FTSE recovers to end modestly higher
- FTSE closes up 7.9 at 6,830.66
- ECB chatter, Thursday's data in focus
- German consumer confidence declines
techMARK 2,845.03 +0.42%
FTSE 100 6,830.66 +0.12%
FTSE 250 16,024.64 +0.17%
The FTSE closed just marginally above its opening level on Wednesday as investors responded to a drop in German consumer confidence, almost flat trading in the US and expectations for the next day's session, which is due to be significantly move data-heavy.
Coming off a sharp dip seen late afternoon, the FTSE ultimately closed 7.9 points higher at 6,830.66.
Chatter about the European Central Bank (ECB) and the quantitative easing (QE) was also moving markets following last week's Jackson Hole symposium.
"The Germans poured some cold water over ECB speculation early on when finance minister Schaeuble commented that Draghi's Jackson Hole speech was 'over interpreted'," CMC market analyst Jasper Lawler said. "The ECB then announced BlackRock had been appointed as a consultant for an asset-backed securities purchase programme, but not long afterwards sources noted that ECB action at the next meeting was unlikely without a slump in inflation.
"Draghi's hand may eventually be forced into an ABS purchase programme, but it still appears the ECB will wait as long as possible in the hopes that it won't be necessary."
That came as German consumer confidence declined for the first time in more than a year, with expectations dropping to 8.6 for September, against expectations for 9.0.
In other news, a measure of UK inflation dropped to its lowest level in a year and a half after the Debt Management Office sold £900m-worth of index-linked gilts due in 2040. The index dropped to 3.265 percentage points.
Investors are also likely to be looking ahead to Thursday's session, which will see the release of US economic growth data for the second quarter amid speculation over the first interest rate hike from the Federal Reserve.
US gross domestic product is forecast to rise an annualised 3.9% in the second quarter after a 4% increase the previous three months. Policymakers are assessing the health of the world's biggest economy to determine the best time to raise interest rates.
Also high on Thursday's agenda will also be the release of German unemployment figures and German inflation amid the suggestion that the European Central Bank (ECB) will introduce full-on quantitative easing to address price instability.
Any indication of weakness in Europe's biggest economy is likely to fuel speculation the ECB will take more action to boost the recovery.
Kantar data sends supermarket shares to opposite ends of spectrum
Sainsbury led the downside after Kantar Worldpanel revealed the supermarket had endured a sales decline of 2.2% and a slight fall in market share from 16.5% to 16.4% year-on-year.
Tesco was also very much in the red after the group, which is Britain's largest supermarket, saw its market share fall 4% year-on-year, from 30.2% to 28.8% in the 12 weeks ended 17 August.
The data also indicated that sales at Morrisons rose 2.4% in the period - the first signs of growth since it initiated a major price-cutting strategy, prompting the group's share price to rise.
United Utilities fell after both RBC Capital Markets and Bank of America downgraded the stock.
Petrofac, the oil and gas explorer was recovering one day after it said revenues had declined to $2.5bn over the six months ended on 30 June. Operating profits on an EBITDA basis were off by 16% to $340m.
FTSE 100 - Risers
Petrofac Ltd. (PFC) 1,149.00p +2.32%
Fresnillo (FRES) 928.50p +1.75%
International Consolidated Airlines Group SA (CDI) (IAG) 363.60p +1.54%
Morrison (Wm) Supermarkets (MRW) 184.40p +1.43%
Associated British Foods (ABF) 2,908.00p +1.29%
London Stock Exchange Group (LSE) 2,061.00p +1.23%
Antofagasta (ANTO) 808.00p +1.19%
Tullow Oil (TLW) 721.00p +1.19%
easyJet (EZJ) 1,370.00p +1.18%
Mondi (MNDI) 1,040.00p +1.17%
FTSE 100 - Fallers
Sainsbury (J) (SBRY) 304.20p -2.59%
Friends Life Group Limited (FLG) 304.60p -1.65%
CRH (CRH) 1,398.00p -1.55%
St James's Place (STJ) 730.00p -1.35%
United Utilities Group (UU.) 896.50p -1.27%
Kingfisher (KGF) 305.00p -1.23%
Tesco (TSCO) 249.30p -1.11%
Aggreko (AGK) 1,711.00p -1.10%
Capita (CPI) 1,214.00p -1.06%
Land Securities Group (LAND) 1,084.00p -0.82%
FTSE 250 - Risers
Lonmin (LMI) 234.10p +5.59%
AL Noor Hospitals Group (ANH) 1,168.00p +5.13%
Ocado Group (OCDO) 403.60p +4.24%
International Personal Finance (IPF) 546.50p +3.50%
RPS Group (RPS) 290.00p +3.46%
Centamin (DI) (CEY) 63.50p +3.42%
Polymetal International (POLY) 540.50p +3.35%
Just Eat (JE.) 260.00p +3.17%
Man Group (EMG) 121.50p +3.14%
Telecity Group (TCY) 737.00p +2.93%
FTSE 250 - Fallers
Foxtons Group (FOXT) 264.00p -10.30%
Countrywide (CWD) 518.50p -4.34%
Hays (HAS) 129.40p -2.93%
Exova Group (EXO) 213.30p -2.11%
Rotork (ROR) 2,745.00p -1.93%
Dunelm Group (DNLM) 873.00p -1.91%
Balfour Beatty (BBY) 242.80p -1.70%
Infinis Energy (INFI) 216.10p -1.68%
Taylor Wimpey (TW.) 115.50p -1.62%
Supergroup (SGP) 1,133.00p -1.48%
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