London close: Stocks firmer on penultimate day of Q3
London stocks finished in the green on Wednesday, underpinned by strong performances from the likes of Next and AstraZeneca.
The FTSE 100 ended the session up 1.14% at 7,108.16, and the FTSE 250 was 0.1% firmer at 23,150.97.
Sterling was in negative territory, meanwhile, last trading down 0.75% on the dollar at $1.3435, and sliding 0.14% against the euro at €1.1571.
“One more day of the third quarter remains, and volatility remains elevated compared to the summer levels, but current market action still has a ‘clearing the decks’ feel to it as the last vestiges of summer trading are swept away and investors prepare for the fourth quarter, many no doubt hoping that it will once again prove to be a good quarter for stock markets,” said IG chief market analyst Chris Beauchamp.
“Any 12-month period in which the FTSE All-World has risen 26% percent is going to be followed up by some jitters, and of course the debt ceiling discussion brings back memories of crises past, but overall this looks like a brief bout of selling and not yet the start of something much worse.”
In data, mortgage approvals ticked lower in August as demand continued to ease from the highs seen during the stamp duty holiday.
According to the latest money and credit report from the Bank of England, there were 74,500 mortgage approvals for house purchase in August.
That was down on July’s 75,100 and the lowest since July 2020, but was, however, above consensus, with most analysts looking for 73,000, and remains above pre-pandemic levels.
Individuals borrowed a net £5.3bn of mortgage debt in August, following a net repayment in July of £1.8bn.
The amount borrowed was £1.4bn below the 12-month average to June 2021, when the full stamp duty holiday was in full effect.
“Some of the heat is coming out of the housing market after a pandemic-fuelled drive for space and the stamp duty cut put the rockets up the market,” said Laura Suter, head of personal finance at AJ Bell.
“The nation’s frugal lockdown saving ways have not been dented by being able to go out and spend more, with us all saving £9.1bn in August, almost double the usual savings amount we saw pre-pandemic.”
UK households, meanwhile, were said to be feeling more downbeat about their finances in a fresh survey, as a post-lockdown surge in confidence faded and living costs surged.
The Scottish Widows Household Finances Index, which measures overall perceptions of financial wellbeing, dipped to 44.0 in the third quarter from 44.7 in the second and 42.0 in the first.
Last time the index fell quarter-on-quarter was in the three months to June 2020, during the first national lockdown.
“UK households recorded slightly weaker trends as the post-lockdown recovery began to subside and living costs surged,” said Jackie Leiper, pensions, stockbroking and distribution director at Scottish Widows.
“Overall financial wellbeing and cash available to spend fell at a slightly quicker rate than in the second quarter.
“Around 10% of households are now considering intergenerational planning, which suggests that Covid-19 has made more families think about how important it is to consider being financially prepared for the unexpected.”
In equity markets, AstraZeneca gained 4.24% after announcing that its newly-acquired Alexion business would buy the remaining shares of drug maker Caelum Biosciences for up to $500m.
Fashion retailer Next rallied 3.89% after it raised full-year guidance as it reported a rise in interim profits and sales as stores reopened from Covid pandemic lockdowns.
The company forecast pre-tax profit of £800m, up 6.9% from 2019 and £36m ahead of previous guidance of £764m.
Full price sales for the rest of the year were expected to be 10% higher from 2019.
Anglo American was boosted 1.61% by an upgrade to ‘outperform’ from ‘sector perform’ at RBC Capital Markets.
"With the shares having pulled back and platinum group metals prices stabilising, Anglo's diversified and growth-heavy portfolio of assets returns to our outperform list," RBC said.
Online auction platform Auction Technology managed gains of 0.46% after saying it had now received all antitrust and regulatory clearances - including from the UK’s Competition and Markets Authority - for its acquisition of LiveAuctioneers.
On the downside, Upper Crust and Ritazza owner SSP fell 5.42% after saying sales in the latest week were half of pre-pandemic levels, as it remained cautious on the pace of the recovery.
SSP said it was assuming a slightly slower recovery in sales during the 2022 financial year due to uncertainty in the pace of post pandemic recovery.
Revenue in the latest week of the year was 53% of 2019 levels.
Royal Mail was under the cosh by 8.81%, after a downgrade to ‘sell’ at UBS.
FTSE 100 - Risers
AstraZeneca (AZN) 8,833.00p 4.24%
Next (NXT) 8,436.00p 3.89%
International Consolidated Airlines Group SA (CDI) (IAG) 185.84p 2.57%
Hikma Pharmaceuticals (HIK) 2,473.00p 2.51%
Rentokil Initial (RTO) 582.40p 2.27%
HSBC Holdings (HSBA) 393.50p 2.11%
Lloyds Banking Group (LLOY) 46.43p 2.05%
Scottish Mortgage Inv Trust (SMT) 1,443.00p 2.01%
Informa (INF) 554.80p 2.01%
Ferguson (FERG) 10,430.00p 1.91%
FTSE 100 - Fallers
Royal Mail (RMG) 440.10p -8.81%
Taylor Wimpey (TW.) 156.20p -1.92%
Admiral Group (ADM) 3,126.00p -1.70%
Polymetal International (POLY) 1,235.00p -1.64%
Smith & Nephew (SN.) 1,314.00p -1.24%
United Utilities Group (UU.) 976.40p -0.97%
Johnson Matthey (JMAT) 2,662.00p -0.86%
Berkeley Group Holdings (The) (BKG) 4,330.00p -0.85%
Ocado Group (OCDO) 1,672.50p -0.83%
Fresnillo (FRES) 765.20p -0.60%
FTSE 250 - Risers
Trustpilot Group (TRST) 355.20p 4.14%
Playtech (PTEC) 459.80p 3.47%
Ferrexpo (FXPO) 318.00p 2.65%
Marshalls (MSLH) 753.50p 2.59%
Grafton Group Ut (CDI) (GFTU) 1,305.00p 2.51%
Oxford Instruments (OXIG) 2,345.00p 2.39%
TP Icap Group (TCAP) 166.14p 2.32%
Future (FUTR) 3,680.00p 2.22%
Centrica (CNA) 56.34p 2.14%
Currys (CURY) 134.60p 1.82%
FTSE 250 - Fallers
Baltic Classifieds Group (BCG) 198.00p -5.77%
SSP Group (SSPG) 274.00p -5.42%
Mitchells & Butlers (MAB) 244.80p -5.14%
Travis Perkins (TPK) 1,606.00p -3.08%
AO World (AO.) 222.20p -2.88%
Syncona Limited NPV (SYNC) 165.00p -2.71%
Moonpig Group (MOON) 332.20p -2.41%
Elementis (ELM) 146.10p -2.26%
Harbour Energy (HBR) 364.20p -2.10%
Softcat (SCT) 2,024.00p -2.03%