London close: Stocks mixed on corporate earnings, Trump tariff threats
By Josh White
Date: Thursday 27 Feb 2025
(Sharecast News) - London stocks closed in a mixed state on Thursday, with the top-flight index recovering from a weaker open as investors absorbed fresh US jobless claims data and a wave of corporate earnings reports.
The FTSE 100 index edged up 0.28% to finish at 8,756.21 points, while the FTSE 250 declined 0.88% to 20,414.73 points.
In currency markets, sterling was last down 0.37% on the dollar to trade at $1.2629, while it gained 0.29% against the euro, changing hands at €1.2124.
Patrick Munnelly, market strategy partner at TickMill, noted that the FTSE was outperforming its European peers amid fresh tariff threats from US president Donald Trump.
"Rolls-Royce surged to a record high, driving an 11% sector boost, after raising mid-term targets and surpassing profit estimates," he said.
"London Stock Exchange Group gained on growth projections, while Aviva rose after exceeding profit expectations.
"Meanwhile, WPP plummeted on a larger-than-expected drop in organic revenue."
Munelly pointed across the channel to the pan-Europe Stoxx 600 falling as tariff-sensitive stocks declined, following Trump's 25% tariff announcement on EU cars and products.
"UK prime minister Keir Starmer is set to discuss tariffs with Trump in Washington."
US jobless claims rise sharply as Trump doubles down on tariff threats
In economic news, US jobless claims rose sharply last week, pointing to potential softening in the American labour market.
The Labor Department reported that initial claims increased by 22,000 to 242,000 in the week ended 22 February, marking the largest rise in more than two months and exceeding expectations of 221,000.
However, continuing claims eased slightly by 5,000 to 1.86 million, while the four-week moving average, which smooths volatility, rose by 8,500 to 224,000.
The insured unemployment rate remained unchanged at 1.2%.
On home shores, UK hospitality sales declined in January, as the industry faced reduced consumer spending following the holiday season and the impact of 'Dry January'.
According to data from CGA by NielsenIQ and RSM, sector-wide sales were 1.3% lower than a year earlier, reversing December's 3.2% growth.
The decline marked the lowest reading in nine months and was only the second year-on-year drop since early 2022.
Pubs saw a marginal 0.1% dip in sales, while restaurants fell 1.1% and bars slumped 10.2%.
The on-the-go segment also suffered, with sales down 4.8%, as adverse weather conditions further weighed on footfall.
"After a happy Christmas for hospitality groups and their suppliers, trading came back down to earth with a bump in January," said Karl Chessell, director of hospitality operators and food for EMEA at CGA by NIQ.
"It shows many consumers remain hesitant about their spending, and while inflation has eased in some areas, business costs remain very high across the sector, and energy price rises and the government's planned changes to National Insurance thresholds and rates could hardly be coming at a worse time."
On the tariff front, US president Donald Trump reaffirmed plans for a 25% tariff on EU imports, arguing that the bloc had long taken advantage of American trade.
Speaking at a cabinet meeting, he criticised European restrictions on US cars and agricultural goods, insisting the tariffs would be implemented "very soon".
The European Commission responded by warning of firm and immediate retaliation against any unjustified trade barriers.
Trump also confirmed that postponed tariffs on Mexico and Canada, initially delayed on 3 February , would take effect on 4 March due to his alleged concerns over drug trafficking.
Additionally, he announced a further 10% tariff on Chinese imports, contradicting previous comments from White House economic officials that a broader review of tariffs was still pending.
Rolls-Royce rockets, Ocado tumbles after tsunami of corporate updates
On London's equity markets, Rolls-Royce shares soared 14.99% after the engineering group raised mid-term guidance, reinstated its dividend for the first time since the pandemic, and unveiled a £1bn share buyback.
The company's annual profit surge, driven by strength in its civil aerospace division, further boosted investor sentiment.
London Stock Exchange Group climbed 5.68%, while Aviva rose 3.35% as both benefited from stronger-than-expected financial results.
Hiscox gained 4.47% after reporting record full-year profits and announcing a $175m share buyback.
Indivior added 2.84% following the appointment of Joe Ciaffoni as its next chief executive officer, contingent on shareholder approval in May.
Man Group and Serco also advanced, rising 2.20% and 3.77% respectively, on earnings results.
On the downside, Ocado tumbled 17.41% despite reporting narrower full-year losses and forecasting positive cash flow by 2026.
WPP slumped 15.75% after the advertising giant posted a decline in annual revenue and projected flat to lower revenue growth for 2025.
St James's Place slid 2.92% despite swinging to a full-year profit, while Haleon dropped 3.56% even after reaffirming its outlook.
John Wood Group fell 9.01% following the abrupt resignation of its chief financial officer, Arvind Balan, over inaccuracies in public disclosures about his qualifications.
The decline came just days after the company confirmed a takeover approach from Dubai's Sidara.
Howden Joinery lost 6.14% after reporting stable annual profits but announcing a £100m share buyback.
Aston Martin Lagonda dropped 25 12.11% after disappointing earnings earlier in the week, while RHI Magnesita slid 7.46% as full-year revenue and earnings declined amid weak market conditions.
Barclays, Diageo, and Ashmore also traded lower, down 2.48%, 3.05% and 4.90% respectively, as they went ex-dividend.
Reporting by Josh White for Sharecast.com.
Market Movers
FTSE 100 (UKX) 8,756.21 0.28%
FTSE 250 (MCX) 20,414.73 -0.88%
techMARK (TASX) 4,741.18 -0.25%
FTSE 100 - Risers
Rolls-Royce Holdings (RR.) 731.60p 15.94%
London Stock Exchange Group (LSEG) 11,775.00p 6.08%
Hiscox Limited (DI) (HSX) 1,169.00p 4.47%
Aviva (AV.) 546.80p 4.19%
International Consolidated Airlines Group SA (CDI) (IAG) 338.70p 3.51%
BAE Systems (BA.) 1,391.50p 3.46%
BT Group (BT.A) 157.60p 1.84%
BP (BP.) 437.85p 1.61%
Pearson (PSON) 1,335.50p 1.40%
Hikma Pharmaceuticals (HIK) 2,182.00p 1.30%
FTSE 100 - Fallers
WPP (WPP) 645.20p -16.23%
Haleon (HLN) 382.40p -3.31%
Berkeley Group Holdings (The) (BKG) 3,588.00p -3.08%
St James's Place (STJ) 1,098.00p -2.92%
Barclays (BARC) 301.05p -2.56%
Taylor Wimpey (TW.) 111.95p -2.31%
3i Group (III) 4,006.00p -2.29%
Diageo (DGE) 2,133.00p -2.29%
Halma (HLMA) 2,777.00p -2.29%
Spirax Group (SPX) 7,300.00p -2.28%
FTSE 250 - Risers
Indivior (INDV) 700.00p 7.53%
Helios Towers (HTWS) 98.50p 4.01%
Serco Group (SRP) 165.00p 3.77%
Ithaca Energy (ITH) 143.80p 2.86%
Direct Line Insurance Group (DLG) 279.00p 2.50%
Man Group (EMG) 213.80p 2.20%
OSB Group (OSB) 437.20p 2.01%
Dr. Martens (DOCS) 68.50p 1.93%
North Atlantic Smaller Companies Inv Trust (NAS) 3,660.00p 1.92%
Senior (SNR) 164.80p 1.48%
FTSE 250 - Fallers
Ocado Group (OCDO) 273.00p -18.07%
Aston Martin Lagonda Global Holdings (AML) 85.00p -12.37%
RHI Magnesita N.V. (DI) (RHIM) 3,475.00p -7.46%
Jupiter Fund Management (JUP) 75.30p -6.58%
Howden Joinery Group (HWDN) 790.00p -6.14%
Endeavour Mining (EDV) 1,545.00p -5.21%
Diversified Energy Company (DEC) 1,051.00p -5.06%
Ashmore Group (ASHM) 147.40p -4.90%
Genuit Group (GEN) 352.50p -4.60%
Kainos Group (KNOS) 716.00p -4.41%
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