London midday: Stocks maintain gains as StanChart surges, Entain slumps
London stocks were still in the black by midday on Thursday as investors sifted through corporate news, with Standard Chartered surging ahead on deal speculation.
The FTSE 100 was up 0.7% at 7,940.01.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: "The FTSE 100 powered up in early trade, gaining more ground back towards the record high, as winds of worry over how far interest rates will go are blown away again. The defensive, international nature of the index has provided the seeds of growth, but an improved forecast for the UK economy this week is also adding fresh nutrients.
"There are hopes the forecasts could see fresh confidence emerge from consumers and limit the expected belt-tightening.
"The UK housing market may be in the doldrums, with sales in the deep freeze in January, but investors are still seeing rays of light on the horizon. The RICS survey indicated sharply lower buyer demand, as the painful mortgage hikes fed through following the mini-budget, but with deals coming down as interest rate expectations have lowered, pessimism has eased and housebuilders still have a small spring in their step."
RICS said in its latest survey that the net balance for house prices softened to -47 from -42 in December. A balance measures the difference between the percentage of surveyors seeing rises and those reporting falls.
New buyer enquiries also fell, with a net balance of -47 compared to -40 a month previously, the ninth successive negative reading. The new instructions balance came in at -14.
RICS said the market was still adjusting to the higher borrowing costs, after mortgage rates rocketed in the autumn in response to the government’s disastrous mini-budget.
Surveyors did not forecast any short-term improvement. The near-term price expectations measure was -66, while sales were expected to continuing falling in the coming three months, with a balance of -49, although that was a marginal uptick on December’s -54.
Simon Rubinsohn, chief economist at RICS, said: "Although some respondents noted a little more interest in the housing market as the new year got underway, the overall tone of the feedback still remains subdued, which is not altogether surprising given the jump in mortgage rates since the autumn.
"Prices, meanwhile, are now beginning to reflect the shift in balance between demand and supply.
"However, it is questionable how much downside to pricing there is likely to be, given that recent macro-forecasts from the Bank of England and others are now envisaging a less harsh economic environment this year."
In equity markets, Standard Chartered was the top performer on the FTSE 100 following a report that First Abu Dhabi Bank is pressing ahead with a potential offer for the bank.
According to Bloomberg, under the code name Silver-Foxtrot, officials at the Abu Dhabi bank are working under the radar on a possible bid once a cooling off period required by UK takeover rules elapses. Sources told Bloomberg that FAB is exploring an all-cash bid of in the range of $30bn to $35bn.
Consumer goods giant Unilever ticked a little higher after it reported better-than-expected sales growth, boosted by higher prices.
On the downside, Watches of Switzerland tumbled as the retailer’s third-quarter revenues missed expectations.
Ladbrokes owner Entain slid after rumours of a possible takeover were quashed. Susannah Streeter said: "Speculation that MGM might be ready to make a move were shut down by the company during an analyst call.
"BetMGM, Entain's joint venture with US-based MGM, has been a shining light for the group that's expected to start turning a profit over the second half of 2023 and that’s partly why the rumour mills have been whirring."
AstraZeneca pushed higher after it reported full-year earnings in line with expectations and said it expects 2023 core profits to grow by high-single to low-double digits.
British American Tobacco lost ground as it posted a slight increase in full-year revenues thanks to volume growth and price increases in its New Category unit, but said the macroeconomic outlook was expected to remain challenging.
FTSE 100 (UKX) 7,940.01 0.70%
FTSE 250 (MCX) 20,340.09 0.18%
techMARK (TASX) 4,588.62 0.78%
FTSE 100 - Risers
Standard Chartered (STAN) 751.60p 9.12%
Ocado Group (OCDO) 728.00p 2.48%
DCC (CDI) (DCC) 4,716.00p 2.23%
Ashtead Group (AHT) 5,690.00p 1.97%
London Stock Exchange Group (LSEG) 7,722.00p 1.69%
St James's Place (STJ) 1,272.50p 1.60%
Weir Group (WEIR) 1,830.00p 1.58%
Scottish Mortgage Inv Trust (SMT) 768.20p 1.48%
Schroders (SDR) 501.20p 1.44%
Abrdn (ABDN) 215.80p 1.36%
FTSE 100 - Fallers
Entain (ENT) 1,433.50p -8.55%
British American Tobacco (BATS) 2,932.00p -5.14%
BT Group (BT.A) 133.90p -3.11%
Imperial Brands (IMB) 1,960.00p -2.39%
United Utilities Group (UU.) 1,050.00p -2.19%
Severn Trent (SVT) 2,822.00p -1.50%
Compass Group (CPG) 1,860.50p -1.46%
Beazley (BEZ) 666.50p -1.19%
SEGRO (SGRO) 851.80p -1.05%
Hiscox Limited (DI) (HSX) 1,137.50p -0.83%
FTSE 250 - Risers
Bakkavor Group (BAKK) 122.00p 4.27%
Ferrexpo (FXPO) 140.90p 4.14%
Aston Martin Lagonda Global Holdings (AML) 183.00p 3.24%
Abrdn Private Equity Opportunities Trust (APEO) 483.00p 2.77%
Just Group (JUST) 84.90p 2.54%
Ascential (ASCL) 276.20p 2.45%
ITV (ITV) 91.86p 2.18%
JTC (JTC) 752.00p 2.17%
Fidelity China Special Situations (FCSS) 285.00p 2.15%
Grafton Group Ut (CDI) (GFTU) 967.20p 2.10%
FTSE 250 - Fallers
Watches of Switzerland Group (WOSG) 926.50p -7.90%
Diversified Energy Company (DEC) 106.30p -4.06%
Virgin Money UK (VMUK) 185.90p -3.68%
Pennon Group (PNN) 903.50p -3.42%
Aberforth Smaller Companies Trust (ASL) 1,376.00p -2.82%
UK Commercial Property Reit Limited (UKCM) 55.00p -2.48%
IWG (IWG) 182.25p -2.33%
Hochschild Mining (HOC) 65.00p -2.18%
Redrow (RDW) 534.50p -1.93%
Greencoat UK Wind (UKW) 161.90p -1.88%