London open: Stocks edge higher as Pearson, Vodafone rally; US GDP eyed

London stocks edged higher in early trade on Friday, underpinned by well-received results from the likes of Pearson and Vodafone, as investors eyed the release of US second-quarter GDP data.

At 0830 BST, the FTSE 100 was up 0.2% at 7,502.03, while the pound was down 0.2% against the dollar at 1.2429 and 0.1% lower versus the euro at 1.1159.

CMC Markets analyst Michael Hewson said: "Today’s first iteration of US Q2 GDP number could well introduce further doubt into market expectations of what sort of messaging that we might get from the Federal Reserve next week.

"While there is no expectation that we won’t get a weaker number than the 3.1% seen in Q1, there is a chance we could see an upside surprise.

"Early estimates are for a number between 1% and 2%, with recent revisions suggesting something nearer to 2%. Any number above 2% would inevitably raises questions as to why it’s even necessary to consider a rate cut, but given weaknesses elsewhere in the global economy, it would still be a big surprise were the Fed not to go next week."

In equity markets, education publisher Pearson was the standout gainer as it reported underlying growth across all divisions as it begins to feel the benefits of accelerating its shift to a digital subscription-style service.

Vodafone rallied after saying it was creating Europe's largest mobile phone tower company with its infrastructure to be legally separated into a new organisation operational by May 2020. It will be made up of 61,700 towers in 10 markets with potential proportionate EBITDA of around €900m. The group also posted a 2.3% dip in first-quarter revenue to €10.7bn (£9.59bn) due to foreign exchange rate effects.

Property website Rightmove was in the green as it reported a jump in first-half profit and announced the acquisition of Van Mildert - a company that provides tenant referencing services and rent guarantee insurance products - for up to £20m.

Peppa Pig owner Entertainment One gained ground after saying that Mark Gordon had signed a multi-year producing deal after speculation last month that he was leaving the company. eOne said would shift from his role as president & chief content officer and focus on developing and producing content for the group.

On the downside, Sports Direct shares retreated as the retailer’s full-year results - already delayed once and due to come out early on Friday - were nowhere to be seen.

Neil Wilson, chief market analyst at Markets.com, said: "A delay on top of a delay does not look good. Investors will take it as a bad sign although we’re not sure if it’s just a technical glitch or something more serious. Time for a fireside chat maybe."

Engineer IMI saw its shares slip after it reported a small drop in interim profit and revenue as its precision engineering continues to be hit by industrial automation weakness.

Market Movers

FTSE 100 (UKX) 7,502.03 0.17%
FTSE 250 (MCX) 19,821.56 0.01%
techMARK (TASX) 3,808.48 0.47%

FTSE 100 - Risers

Pearson (PSON) 937.80p 7.13%
Vodafone Group (VOD) 140.96p 6.79%
Rightmove (RMV) 536.20p 4.81%
St James's Place (STJ) 1,066.50p 1.52%
Diageo (DGE) 3,285.50p 1.39%
Berkeley Group Holdings (The) (BKG) 3,900.00p 1.30%
Auto Trader Group (AUTO) 535.80p 1.21%
Relx plc (REL) 1,888.50p 1.12%
Rentokil Initial (RTO) 411.72p 0.76%
JD Sports Fashion (JD.) 621.93p 0.70%

FTSE 100 - Fallers

Anglo American (AAL) 2,095.00p -4.21%
Evraz (EVR) 640.20p -2.14%
Sage Group (SGE) 718.40p -1.86%
Antofagasta (ANTO) 946.00p -1.46%
Micro Focus International (MCRO) 1,667.40p -1.21%
Glencore (GLEN) 272.50p -1.20%
Phoenix Group Holdings (PHNX) 704.31p -1.07%
International Consolidated Airlines Group SA (CDI) (IAG) 441.00p -0.83%
Smurfit Kappa Group (SKG) 2,644.00p -0.83%
Morrison (Wm) Supermarkets (MRW) 196.90p -0.81%

FTSE 250 - Risers

Safestore Holdings (SAFE) 664.50p 2.39%
Aston Martin Lagonda Global Holdings (AML) 645.18p 2.31%
Howden Joinery Group (HWDN) 562.00p 1.85%
Elementis (ELM) 140.90p 1.66%
Pennon Group (PNN) 729.69p 1.43%
Polar Capital Technology Trust (PCT) 1,450.00p 1.26%
Cairn Energy (CNE) 164.02p 1.25%
Drax Group (DRX) 302.00p 1.07%
GVC Holdings (GVC) 626.20p 1.00%
Metro Bank (MTRO) 388.80p 0.99%

FTSE 250 - Fallers

Computacenter (CCC) 1,312.00p -2.16%
FirstGroup (FGP) 111.64p -2.15%
Hochschild Mining (HOC) 207.68p -1.76%
AJ Bell (AJB) 428.06p -1.59%
Centamin (DI) (CEY) 117.15p -1.55%
Intu Properties (INTU) 77.84p -1.47%
Kaz Minerals (KAZ) 578.60p -1.46%
Hill & Smith Holdings (HILS) 1,149.00p -1.29%
IMI (IMI) 1,018.50p -1.26%
Premier Oil (PMO) 81.00p -1.17%