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London close: Stocks fall amid renewed global jitters

By Josh White

Date: Thursday 13 Jun 2024

London close: Stocks fall amid renewed global jitters

(Sharecast News) - London markets exhibited a mixed performance on Thursday, as investors digested the latest policy announcement from the US Federal Reserve and reacted to corporate developments in various sectors.

The FTSE 100 index fell 0.63% to 8,163.67 by the close, while the FTSE 250 saw a sharper decline of 1.47%, settling at 20,195.95.

Movements were influenced by the US Federal Reserve's decision to maintain interest rates between 5.25% and 5.5% overnight.

The Fed also adjusted its forecast for rate cuts this year, reducing the expected number from three to just one, reflecting a more cautious approach to easing monetary policy.

On the currency front, sterling was last down 0.14% on the dollar to trade at $1.2780, while it increased 0.03% against the euro, changing hands at €1.1844.

"It has been a week to forget for Europe," said IG chief market analyst Chris Beauchamp.

"Snap French elections have sent investors scurrying from European stocks, just as those markets began to hit their stride after a decade and more of underperformance versus the US.

"Compared to the prospect of hard-right members sitting in the National Assembly, the UK seems an island of stability, though the FTSE 100 and 250 have not been able to escape the general risk-off move today."

UK housing market declines in May, US unemployment claims rise

In economic news, the UK housing market experienced a decline in May as house prices fell, according to the Royal Institution of Chartered Surveyors (RICS).

The net house prices balance dropped to -17 from -7 in April, marking the lowest level since January.

New buyer enquiries also fell to the lowest since November, with a balance of -8 compared to -1 in the prior month.

Additionally, the number of agreed sales decreased sharply, falling to -13 from 4.

Despite the declines, market expectations for the coming months remained positive, with a balance of 43 anticipating increased sales activity over the next year, up from 33 in April.

"The recent recovery across the UK housing market appears to have slipped into reverse of late, with buyer demand losing momentum slightly on the back of the upward moves seen in mortgage rates over the past couple of months," said Tarrant Parsons, RICS senior economist.

"Nevertheless, expectations point to this delaying, rather than derailing, a modest improvement going forward."

On the continent, eurozone industrial production unexpectedly declined in April, according to Eurostat.

Seasonally-adjusted industrial production in the Eurozone eased by 0.1%, following a 0.5% increase in March.

Analysts had predicted a modest 0.2% rise. In the wider EU, industrial production rose by 0.5%.

Intermediate goods saw the largest decline, with output falling by 0.2% in the EU and 0.4% in the Eurozone.

Among member states, Germany reported a 0.3% increase, France saw a 0.6% rise, while production was flat in Spain and down 1% in Italy.

Year-on-year, industrial production in the Eurozone fell by 3%, exceeding analyst expectations of a 1.9% decline, and dropped by 2% in the broader EU.

Across the Atlantic, initial unemployment claims in the US increased during the week ended 8 June , according to the Department of Labor.

Seasonally adjusted initial claims rose by 13,000.

The four-week moving average, designed to smooth weekly fluctuations, increased by 4,750 to 227,000.

Continuing claims, referring to those not filed for the first time for the week ending June 1, climbed by 30,000 to 1.82 million.

Wholesale inflation in the US meanwhile saw an unexpected decline in May.

The Department of Labor reported that final demand prices fell by 0.2% month-on-month, contrary to the anticipated 0.1% drop.

That decrease was driven by an 0.8% decline in goods prices, with energy costs falling by 4.8%. Food prices dipped by 0.1%, while service prices remained flat.

Transportation and warehousing prices decreased by 1.4%, and trade prices, including retailer margins, increased by 0.2%.

Annually, the producer price index slowed from 2.3% in April to 2.2% in May, below the expected 2.5%.

Core producer prices remained flat month-on-month, missing the consensus forecast of a 0.3% increase.

Halma jumps on record profits, ex-divs prove a drag

On London's equity markets, ex-dividend stocks dragged on the FTSE 350, as Intermediate Capital Group dropped by 5.36%, Land Securities Group by 3.58%, JD Sports Fashion by 1.69%, Compass Group by 0.85%, and LondonMetric Property by 3.61%.

Housebuilder Crest Nicholson Holdings saw a significant fall, plunging 10.55%.

The drop came after the company slashed its interim dividend payment following a swing to a loss in the first half and substantially lowering its profit guidance for the full year.

Wise, the banking and money transfer company, slid 11.45% as it projected lower underlying income growth for the current financial year compared to 2024.

St James's Place also experienced a decline, falling 1.88%.

The wealth management company announced the appointment of Caroline Waddington, the current CFO of Credit Suisse's UK operations, as its new CFO, replacing Craig Gentle who is retiring after six years in the role.

On the upside, Halma surged by 13.36%.

The safety and environmental technology firm reported another year of record profit and revenue, attributing the strong performance to solid results in its safety and environment & analysis sectors.

For the year ending March 2024, Halma's adjusted pre-tax profit rose 10% to £396.4m, with revenue up 10% to £2.03bn.

BT Group rallied 4.33% following news that Mexican billionaire Carlos Slim took a 3.2% stake in the telecoms firm.

The stake, valued at around £400m, was acquired by Slim's family business, Inbursa, according to a regulatory filing.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 8,163.67 -0.63%
FTSE 250 (MCX) 20,195.95 -1.47%
techMARK (TASX) 4,806.77 -0.18%

FTSE 100 - Risers

Halma (HLMA) 2,664.00p 13.36%
BT Group (BT.A) 135.00p 4.33%
Severn Trent (SVT) 2,520.00p 4.18%
United Utilities Group (UU.) 1,050.50p 3.04%
Haleon (HLN) 325.80p 1.56%
Reckitt Benckiser Group (RKT) 4,457.00p 1.53%
Sainsbury (J) (SBRY) 258.20p 0.70%
Anglo American (AAL) 2,389.00p 0.61%
Ocado Group (OCDO) 351.00p 0.60%
Intertek Group (ITRK) 4,890.00p 0.58%

FTSE 100 - Fallers

Intermediate Capital Group (ICG) 2,226.00p -5.36%
Ashtead Group (AHT) 5,496.00p -4.58%
Persimmon (PSN) 1,441.00p -3.81%
RS Group (RS1) 705.50p -3.42%
Land Securities Group (LAND) 622.00p -3.19%
Kingfisher (KGF) 255.80p -2.81%
Fresnillo (FRES) 539.00p -2.80%
Croda International (CRDA) 4,151.00p -2.79%
Berkeley Group Holdings (The) (BKG) 5,070.00p -2.69%
Legal & General Group (LGEN) 223.70p -2.65%

FTSE 250 - Risers

Bank of Georgia Group (BGEO) 3,845.00p 3.22%
Essentra (ESNT) 171.20p 1.66%
Pennon Group (PNN) 599.00p 1.53%
Syncona Limited NPV (SYNC) 110.00p 1.48%
HICL Infrastructure (HICL) 123.40p 1.31%
Octopus Renewables Infrastructure Trust (ORIT) 73.70p 1.24%
JPMorgan Global Growth & Income (JGGI) 556.00p 1.09%
North Atlantic Smaller Companies Inv Trust (NAS) 3,990.00p 1.01%
Target Healthcare Reit Ltd (THRL) 79.50p 0.76%
Herald Investment Trust (HRI) 2,180.00p 0.69%

FTSE 250 - Fallers

Crest Nicholson Holdings (CRST) 212.80p -11.63%
TBC Bank Group (TBCG) 2,350.00p -7.84%
Close Brothers Group (CBG) 424.60p -6.06%
Mobico Group (MCG) 48.00p -5.88%
Victrex plc (VCT) 1,148.00p -5.75%
OSB Group (OSB) 444.40p -5.49%
Watches of Switzerland Group (WOSG) 395.60p -4.72%
Trainline (TRN) 304.40p -4.70%
Abrdn (ABDN) 144.15p -4.57%
Hochschild Mining (HOC) 171.80p -4.34%

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