London open: Next and RBS lead stocks higher on Super Thursday

London stocks edged tentatively higher on Super Thursday as investors eyed the latest policy announcement from the Bank of England and waded through a deluge of corporate news.

At 0850 BST, the FTSE 100 was up 0.2% to 7,677.49, while the pound was up 0.1% against the dollar at 1.3560 and down 0.1% versus the euro at 1.1419 as investors looked ahead to the Bank of England’s interest rate decision, the quarterly inflation report, meeting minutes and the latest economic projections.

The BoE rate decision is at 1200 BST. Before that, industrial and manufacturing production figures and the trade balance will be released at 0930 BST.

The probability of a rate hike has dropped to just 10% from around 90% at the beginning of last month following the release of some uninspiring UK data, which included first-quarter GDP. This rose just 0.1% in the first three months of the year, well below the 0.4% growth seen in the first quarter of last year.

David Morrison, senior market strategist at GKFX, said: "Traders should now prepare themselves for the possibility of a big move in sterling. A rate hike may no longer be on the cards, but the Bank’s inflation outlook will be crucial. Headline CPI (including food and energy) has drifted back to +2.5% annualised. While this is well below the +3.1% recorded towards the end of last year it’s still comfortably above the Bank’s 2% target.

"If the report suggests that the Bank is looking past the recent slowdown in CPI and sees inflation steadying above its 2% target, then this should be positive for sterling, at least in the short-term. But any indication that inflation is set to decline further, particularly given the slowdown in growth, would imply that rate hikes are off the table for this year. In this case we should expect the GBPUSD to retest support around 1.3500 in short order."

Meanwhile, the monthly RICS survey released earlier showed that house prices dipped in April as sentiment in the London market dropped to a low not seen since the UK was in recession. The balance of estate agents reporting rising or falling prices was -8% in April after two flat months. Though the decline was slight, it was the most negative figure since November 2012, RICS said.

On the corporate front, Next rallied after the clothing retailer upgraded its profit guidance for the year, as it posted a rise in first-quarter sales thanks to unusually warm weather in recent weeks.

Royal Bank of Scotland was on the front foot as it agreed to pay $4.9bn (£3.6bn) to settle a long-running investigation by the US Department of Justice into the bank’s dealing in mortgage-backed securities before the financial crisis.

Broadcaster ITV advanced after it posted a 5% rise in total first-quarter external revenue and said it’s on track to deliver double-digit growth in online revenue.

Morrisons was on the front foot after it reported a strong start to the year, with group like-for-like sales in the 13 weeks to 6 May up 3.6%.

Coca-Cola HBC rose despite saying that first-quarter net sales fell 1.7%, mainly due to currency hits from the Russian rouble and Nigerian naira.

On the downside, BT slumped as it announced 13,000 back office job cuts as part of a new operating strategy that aims to cut £1.5bn of costs within three years, launch 'converged' products and increase full-fibre broadband.

Outsourcer Capita nosedived as its stock went ex-rights, while Randgold Resources retreated after it said profit fell 22% in the first quarter.

On the Beach was under the cosh even as it posted a jump in interim profit and revenue, while Superdry fell after it reported a 6% drop in full-year store sales.

In broker note action, Schroders was downgraded to ‘hold’ at Berenberg, while Interserve was cut to ‘hold’ at Liberum and Lonmin was knocked down to ‘sell’ at Liberum. IMI was upgraded to ‘buy’ at Jefferies.

Admiral, BP, Centrica, GlaxoSmithKline, Shell, Sage, Fidessa, Hochschild, Hiscox, Polymetal and Greencoat UK Wind all went ex-dividend on Thursday.

FTSE 100 - Risers

Next (NXT) 5,556.00p 5.91%
Royal Bank of Scotland Group (RBS) 291.10p 5.43%
ITV (ITV) 157.37p 4.08%
RSA Insurance Group (RSA) 652.40p 2.68%
Morrison (Wm) Supermarkets (MRW) 251.40p 2.44%
easyJet (EZJ) 1,694.50p 2.20%
Coca-Cola HBC AG (CDI) (CCH) 2,514.00p 1.95%
Standard Chartered (STAN) 762.40p 1.76%
International Consolidated Airlines Group SA (CDI) (IAG) 705.96p 1.66%
Rentokil Initial (RTO) 325.20p 1.59%

FTSE 100 - Fallers

Randgold Resources Ltd. (RRS) 5,670.59p -7.04%
BT Group (BT.A) 223.11p -6.49%
Centrica (CNA) 148.15p -4.70%
Admiral Group (ADM) 1,976.50p -1.76%
BP (BP.) 562.80p -1.61%
Evraz (EVR) 502.20p -1.10%
Royal Dutch Shell 'B' (RDSB) 2,697.10p -0.91%
Royal Dutch Shell 'A' (RDSA) 2,612.50p -0.80%
British American Tobacco (BATS) 3,878.00p -0.79%
Fresnillo (FRES) 1,290.50p -0.69%

FTSE 250 - Risers

Capita (CPI) 129.85p 6.36%
Sirius Minerals (SXX) 34.42p 3.05%
Vesuvius (VSVS) 635.50p 2.91%
Kaz Minerals (KAZ) 1,009.50p 2.91%
RPC Group (RPC) 792.80p 1.77%
Hill & Smith Holdings (HILS) 1,475.00p 1.72%
Equiniti Group (EQN) 278.50p 1.64%
OneSavings Bank (OSB) 424.60p 1.58%
Softcat (SCT) 719.00p 1.55%
McCarthy & Stone (MCS) 137.10p 1.48%

FTSE 250 - Fallers

On The Beach Group (OTB) 576.96p -11.24%
Superdry (SDRY) 1,384.00p -10.71%
TI Fluid Systems (TIFS) 250.00p -3.10%
Provident Financial (PFG) 675.75p -2.85%
Drax Group (DRX) 323.40p -2.65%
Polymetal International (POLY) 713.15p -2.63%
SIG (SHI) 137.35p -2.45%
Ibstock (IBST) 294.40p -2.26%
Fidessa Group (FDSA) 3,845.00p -2.16%
CLS Holdings (CLI) 248.00p -1.78%