LONDON (ShareCast) - (Sharecast News) - London stocks ended the trading session on Friday with a dip in performance, after disappointing retail sales figures had a downward impact on the value of the pound.

The FTSE 100 closed up 0.04% at 7,461.93, while the FTSE 250 experienced a decline of 0.4% to 18,871.41.

In currency markets, sterling was last down 0.28% on the dollar, trading at $1.2670, while it slipped 0.32% against the euro to change hands at €1.1646.

"As the Nasdaq 100 is hitting new all-time record highs European stock indices have seen their second, or in case of the FTSE 100 their third, weekly loss since the beginning of the year," said IG senior market analyst Axel Rudolph.

"Pared back rate cut expectations to the second half of the year have impacted European stocks more negatively as their economies look less healthy than their US counterpart.

"In the UK retail sales fell the most in nearly three years as US existing home sales hit a 13-year low at a time when US consumer sentiment jumped to 2021-highs ahead of next week's Bank of Japan, Bank of Canada and European Central Bank interest rate decisions."

Rudolph added that elevated tensions in the Middle East were leading to a third straight day of gains for the oil price.

"The gold price only rose marginally for a second consecutive day as flight-to-quality flows into the precious metal abate and the greenback extends its gains."

UK retail sales see sharpest decline since Covid lockdowns

In economic news, fresh official data revealed that UK retail sales experienced their sharpest decline since the beginning of 2021 in December, falling short of analyst expectations.

According to the Office for National Statistics (ONS), retail sales volumes dropped by 3.2%, reversing the previously revised 1.4% increase observed in November.

The decline marked the largest monthly drop since January 2021, coinciding with the lockdown period.

Most analysts had anticipated a more modest 0.5% decline.

Year-on-year growth also dipped to 2.4% from November's 0.2%, and over the three months leading up to December, sales decreased by 0.9% quarter-on-quarter, affecting both food and non-food sales.

Non-food sales volumes fell by 3.9%, while food store sales were down by 3.1%.

"Following a strong November, retail sales plummeted in December with all types of outlets being hit," said Heather Bovill, deputy director for surveys and economic indicators at the ONS.

"Food stores performed very poorly, with their steepest fall since May 2021 as early Christmas shopping led to slow December sales.

"Department stores, clothing shops and household goods retailers reported sluggish sales too as consumers spent less on Christmas gifts, but had also purchased earlier during Black Friday promotions, to help spread the cost."

On the continent, producer prices in Germany experienced a substantial decline in December, surpassing expectations.

Data from Destatis showed that producer prices of industrial products were 8.6% lower year-on-year in the last month, exceeding November's 7.9% decline.

Analysts had originally projected an 8% decrease.

On a month-on-month basis, producer prices showed a notable drop of 1.2%, significantly surpassing the anticipated 0.4% decline.

When considering the annual average, prices were 2.4% lower in 2023 compared to the previous year.

Finally on data, inflation in Japan slowed in December to its lowest level in 17 months, according to government figures released overnight.

The decline was primarily attributed to falling energy prices and a reduction in upward pressure on core consumer prices.

The consumer price index (CPI) for the last month was 2.6% higher than in December 2022, marking a deceleration from the 2.8% inflation rate observed in November.

Food price inflation also decreased to a 14-month low of 6.7%, down from 7.3%.

That represented the lowest headline CPI inflation rate since July 2022, following a peak of 4.3% in January 2023.

Excluding fresh food prices, inflation slowed to 2.3% from 2.5%, aligning with market estimates.

Meanwhile, core inflation, which excludes food and energy, eased to 3.7% from 3.8%.

4imprint on the back foot, Wincanton surges on takeover deal

On London's equity markets, promotional merchandise maker 4imprint Group jumped XXXXX after it announced that annual earnings would slightly exceed forecasts, following a robust trading performance throughout 2023.

4imprint projected a 16% increase in group revenue, reaching $1.33bn, with a pre-tax profit of at least $140m, surpassing the upper end of analysts' current range of forecasts and last year's figure of $104m.

Housebuilder Persimmon managed gains after Morgan Stanley double-upgraded its shares from 'underweight' to 'overweight' and raised the price target to 1,685p from 1,131p.

The upgrade was based on Persimmon's focus on affordable homes across the UK and the expectation of improved affordability as mortgage rates fall, positioning the company favourably for a potential volume recovery in the housing sector.

Insurance companies Legal & General and Just Group advanced after JPMorgan reiterated its 'overweight' stance on both firms.

Aviva's stock price managed a rise following an upward revision of its price target by JPMorgan Cazenove, from 545p to 575p, in a note pertaining to the UK life insurance sector.

After declining on Thursday following a revenue warning, Watches of Switzerland Group managed to regain some ground on Friday, with its stock price increasing by the close.

On the downside, Endeavour Mining was in the spotlight with a decline, after it reported that former CEO Sébastien de Montessus, who was dismissed earlier this month due to serious misconduct, would miss out on $17.6m in bonuses and share awards.

Endeavour also mentioned that it would be reclaiming an additional $11.5m in share awards and bonuses paid over the past three years.

Takeaway delivery giant Deliveroo was off by the close, reversing earlier gains.

The decline followed Deliveroo's announcement that annual earnings would be "slightly" ahead of guidance, and despite a 7% year-on-year increase in gross transaction value (GTV) in the UK and Ireland, in the midst of the ongoing cost-of-living crisis.

Outside the FTSE 350, logistics firm Wincanton rocketed after it agreed to be taken private by Ceva Logistics, a subsidiary of French shipping specialist CMA CGM, in a deal valued at £566.9m.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 7,461.93 0.04%
FTSE 250 (MCX) 18,871.41 -0.40%
techMARK (TASX) 4,328.59 0.37%

FTSE 100 - Risers

Flutter Entertainment (CDI) (FLTR) 15,695.00p 3.09%
JD Sports Fashion (JD.) 111.25p 2.77%
Vodafone Group (VOD) 67.64p 2.62%
Pershing Square Holdings Ltd NPV (PSH) 3,620.00p 2.49%
Beazley (BEZ) 514.00p 1.68%
Rentokil Initial (RTO) 401.10p 1.67%
Centrica (CNA) 141.45p 1.25%
SSE (SSE) 1,757.00p 1.21%
Admiral Group (ADM) 2,528.00p 1.08%
InterContinental Hotels Group (IHG) 7,422.00p 1.06%

FTSE 100 - Fallers

Entain (ENT) 916.80p -3.45%
Ocado Group (OCDO) 552.00p -3.40%
Whitbread (WTB) 3,548.00p -2.39%
Glencore (GLEN) 412.30p -1.80%
Smiths Group (SMIN) 1,646.00p -1.56%
Associated British Foods (ABF) 2,240.00p -1.41%
Marks & Spencer Group (MKS) 250.50p -1.38%
Diploma (DPLM) 3,232.00p -1.28%
B&M European Value Retail S.A. (DI) (BME) 518.20p -1.26%
Fresnillo (FRES) 477.00p -1.16%

FTSE 250 - Risers

4Imprint Group (FOUR) 5,190.00p 11.97%
Watches of Switzerland Group (WOSG) 385.60p 3.82%
RHI Magnesita N.V. (DI) (RHIM) 3,356.00p 2.82%
Just Group (JUST) 85.10p 2.28%
Indivior (INDV) 1,230.00p 2.16%
NB Private Equity Partners Ltd. (NBPE) 1,614.00p 2.15%
Drax Group (DRX) 474.30p 2.13%
Kainos Group (KNOS) 1,016.00p 1.60%
Hipgnosis Songs Fund Limited NPV (SONG) 72.10p 1.55%
Ibstock (IBST) 144.30p 1.55%

FTSE 250 - Fallers

Future (FUTR) 701.50p -6.15%
AJ Bell (AJB) 297.00p -5.35%
Wizz Air Holdings (WIZZ) 1,881.00p -4.78%
Ferrexpo (FXPO) 80.75p -4.61%
Discoverie Group (DSCV) 731.00p -4.07%
Darktrace (DARK) 344.90p -3.90%
TI Fluid Systems (TIFS) 136.20p -3.54%
Vistry Group (VTY) 911.00p -3.39%
C&C Group (CDI) (CCR) 147.80p -3.27%
Ashmore Group (ASHM) 215.20p -3.06%

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