London open: Stocks edge up ahead of retail sales

London stocks edged higher in early trade on Thursday after China cut its benchmark lending rates, as investors eyed the latest UK retail sales figures.

At 0840 GMT, the FTSE 100 was up 0.2% at 7,472.80.

Earlier, the People’s Bank of China cut the one-year loan prime rate to 4.05% from 4.15% and the five-year rate to 4.75% from 4.80%.

CMC Markets analyst Michael Hewson said: "The belief that central banks and governments can offset any economic downside from the virus with monetary and fiscal stimulus has continued to help drive asset prices higher, with Asia markets also rising this morning as China announced another reduction in its loan prime rate, in a move that wasn’t unexpected."

On home turf, UK retail sales data for January is due at 0930 GMT.

"We expect to see a decent rebound in January as some of the shackles come off and consumers become more confident about the outlook domestically, with expectations of a rise of 0.7%, to start 2020 on a positive note," Hewson said.

"A decent number here, along with some positive flash PMIs tomorrow will in all likelihood put to bed any speculation that the Bank of England will be cutting rates any time soon, particularly since the March 11th budget still looks set to take place as scheduled."

In equity markets, Smith & Nephew was the standout gainer as the artificial hip and knee maker said full-year revenue grew 4.4% but that its outlook will depend on the coronavirus.

Lloyds followed close behind even as the bank said underlying profit fell 7% last year as revenue declined in challenging conditions.

BAE Systems was in the green as it reported full-year earnings growth of 7%, in line with its own guidance, and forecast a rise in earnings in 2021 by mid-single digit, excluding the impact of recent US acquisitions.

Price comparison website Moneysupermarket.com rallied after it posted a rise in full-year profit as solid performances from the home services and insurance businesses offset a weaker showing in the money segment.

Spectris pushed higher after reporting a jump in full-year operating profit and £175m special dividend, but saying it was seeing less activity in China due to the coronavirus and expects "challenging" markets in the first half of the current year.

Builders’ merchant Travis Perkins was boosted by an upgrade to ‘buy’ at Citi and gold miner Centamin shone after BMO reinstated the stock at ‘outperform’.

On the downside, Imperial Brands, Carnival, Unilever and GlaxoSmithKline were all weaker as their stock went ex-dividend.

Recruiter Hays was under pressure as it posted a drop in first-half profit as tough market conditions took their toll on its German business.

Market Movers

FTSE 100 (UKX) 7,472.80 0.21%
FTSE 250 (MCX) 21,941.84 0.42%
techMARK (TASX) 4,195.12 0.67%

FTSE 100 - Risers

Smith & Nephew (SN.) 1,956.00p 6.02%
Lloyds Banking Group (LLOY) 57.43p 2.96%
NMC Health (NMC) 804.80p 2.78%
BAE Systems (BA.) 654.20p 2.22%
Antofagasta (ANTO) 867.40p 1.47%
Melrose Industries (MRO) 248.50p 1.47%
Anglo American (AAL) 2,118.00p 1.44%
JD Sports Fashion (JD.) 875.00p 1.41%
Smith (DS) (SMDS) 354.60p 1.05%
Rio Tinto (RIO) 4,245.50p 1.05%

FTSE 100 - Fallers

Imperial Brands (IMB) 1,778.20p -3.57%
Meggitt (MGGT) 625.60p -1.82%
GlaxoSmithKline (GSK) 1,655.20p -1.36%
International Consolidated Airlines Group SA (CDI) (IAG) 633.60p -1.31%
Unilever (ULVR) 4,574.50p -1.09%
Burberry Group (BRBY) 1,992.50p -1.02%
National Grid (NG.) 1,057.20p -0.96%
Carnival (CCL) 3,087.00p -0.93%
Vodafone Group (VOD) 155.16p -0.41%
Sage Group (SGE) 791.40p -0.40%

FTSE 250 - Risers

Moneysupermarket.com Group (MONY) 335.10p 8.17%
Hochschild Mining (HOC) 192.90p 6.46%
Spectris (SXS) 2,901.00p 6.03%
TBC Bank Group (TBCG) 1,368.00p 4.43%
Travis Perkins (TPK) 1,744.50p 2.74%
Centamin (DI) (CEY) 146.10p 2.71%
Virgin Money UK (VMUK) 184.15p 2.42%
TalkTalk Telecom Group (TALK) 119.80p 2.39%
Kaz Minerals (KAZ) 521.00p 2.36%
Hunting (HTG) 312.00p 2.30%

FTSE 250 - Fallers

Sabre Insurance Group (SBRE) 323.50p -2.12%
BBGI SICAV S.A. (DI) (BBGI) 164.00p -2.09%
Micro Focus International (MCRO) 790.10p -1.39%
Future (FUTR) 1,376.00p -1.01%
Close Brothers Group (CBG) 1,429.00p -0.97%
Pagegroup (PAGE) 460.00p -0.95%
Pennon Group (PNN) 1,191.50p -0.91%
GCP Student Living (DIGS) 207.50p -0.72%
Jupiter Fund Management (JUP) 390.50p -0.64%
Quilter (QLT) 170.50p -0.61%