London close: Stocks mixed as US inflation comes in hot
By Josh White
Date: Wednesday 12 Feb 2025
(Sharecast News) - London stocks closed in a mixed state on Wednesday, as markets reacted to a stronger-than-expected inflation reading from the United States.
The FTSE 100 index advanced 0.34% to finish at 8,807.44 points, while the more domestically-focussed FTSE 250 slipped 0.19% to 20,880.50 points.
In currency markets, sterling was last up 0.16% on the dollar to trade at $1.2466, as it weakened 0.32% against the euro, changing hands at €1.1973.
"Higher-than-expected US CPI data, including core inflation, provoked an over 10-basis point surge in the US 10-year Treasury yield to 4.65%," said IG senior technical analyst Axel Rudolph.
"The US dollar only briefly appreciated ... before giving back all of its gains despite US Fed rate cut expectations being pared back to July.
"Stock indices dropped, but whereas US indices remained in the red, their European counterparts ended the day in the green."
Rudolph noted that crude prices slipped by over one percent despite initial gains in the US dollar following the hotter-than-expected US inflation print being rapidly wiped out.
"The gold price flatlined whereas silver and copper prices rose by around a percentage point."
Consumer price growth comes in hotter than expected stateside
In economic news, US consumer prices rose more than expected in January, highlighting persistent inflationary pressures across the economy.
Data from the Bureau of Labor Statistics showed the consumer price index (CPI) increased 0.5% for the month, pushing the annual inflation rate up to 3% from 2.9% in December.
The index reached 317.67 points, up from 315.61 in the previous month.
Shelter costs remained a key driver, rising 0.4% in January and accounting for nearly 30% of the overall monthly increase.
Core inflation, which excludes food and energy prices, also exceeded expectations, rising 3.3% year-on-year, up from 3.2% in December.
Economists had forecast a decline to 3.1%.
On a monthly basis, core CPI advanced 0.4%, underscoring the challenge of bringing inflation back to target levels.
"While today's CPI report is certainly not positive under the eyes of the Fed, we would caution about extrapolating January's notable strength into the medium term outlook for inflation," said analysts at TD Securities.
"The main takeaway is that today's report will keep the Fed on the sidelines for a while, in line with our long-held view.
"We still expect the FOMC to resume rate cuts in the third quarter."
Barratt Redrow in the green on profit growth, Close Brothers slides
On London's equity markets, Barratt Redrow surged 4.53% after reporting a 23% rise in interim pre-tax profit to £117.2m, and raising its dividend by 25% to 5.5p per share.
The housebuilder said full-year earnings were expected to be at the upper end of forecasts, which range from £506m to £588m for 2025.
Prudential climbed 6.83% after it announced it was considering a partial divestment of its shares in ICICI Prudential Asset Management, its Indian investment management joint venture.
The company said proceeds from the potential listing would be returned to shareholders while reaffirming India's strategic importance for future growth.
Indivior gained 6.47% despite news that the US Food and Drug Administration had delayed its final review of proposed label changes for its Sublocade treatment.
The firm said the regulator had no outstanding concerns but did not provide a timeline for approval.
TBC Bank Group jumped 11.37% after reporting record revenue and a strong rise in fourth-quarter profit.
The UK-listed Georgian bank expressed confidence in achieving its 2025 strategic targets.
On the downside, Close Brothers Group tumbled 6.03% after setting aside £165m to cover costs related to the mis-selling of motor finance.
The provision would reduce its CET1 capital ratio to 12% from 13.5% at the end of December, though the company said recent steps to strengthen its capital position would mitigate the impact.
Elsewhere, packaging giant Smurfit Westrock declined 4.8% following its latest earnings report.
Reporting by Josh White for Sharecast.com.
Market Movers
FTSE 100 (UKX) 8,807.44 0.34%
FTSE 250 (MCX) 20,880.50 -0.19%
techMARK (TASX) 4,767.73 0.57%
FTSE 100 - Risers
Prudential (PRU) 722.00p 5.77%
Entain (ENT) 696.00p 5.45%
Barratt Redrow (BTRW) 460.10p 5.29%
Croda International (CRDA) 3,131.00p 2.66%
Kingfisher (KGF) 253.40p 2.56%
Flutter Entertainment (DI) (FLTR) 21,820.00p 2.25%
easyJet (EZJ) 519.80p 2.08%
Schroders (SDR) 384.40p 2.07%
Lloyds Banking Group (LLOY) 63.90p 1.75%
JD Sports Fashion (JD.) 87.10p 1.63%
FTSE 100 - Fallers
Smurfit Westrock (DI) (SWR) 4,007.00p -7.01%
Glencore (GLEN) 341.00p -2.47%
Centrica (CNA) 137.05p -2.11%
St James's Place (STJ) 1,099.00p -1.79%
Games Workshop Group (GAW) 14,410.00p -1.71%
Diageo (DGE) 2,134.00p -1.68%
United Utilities Group (UU.) 983.20p -1.68%
Ashtead Group (AHT) 4,999.00p -1.63%
Taylor Wimpey (TW.) 115.30p -1.50%
National Grid (NG.) 954.40p -1.43%
FTSE 250 - Risers
TBC Bank Group (TBCG) 4,010.00p 8.53%
Indivior (INDV) 814.50p 6.47%
Hochschild Mining (HOC) 195.40p 4.83%
Bakkavor Group (BAKK) 145.00p 4.69%
Moonpig Group (MOON) 227.50p 4.60%
Lion Finance Group (BGEO) 5,170.00p 3.82%
Wizz Air Holdings (WIZZ) 1,592.00p 3.71%
Baltic Classifieds Group (BCG) 357.00p 3.63%
International Workplace Group (IWG) 194.30p 2.97%
Ithaca Energy (ITH) 135.00p 2.90%
FTSE 250 - Fallers
Ocado Group (OCDO) 312.50p -4.58%
GCP Infrastructure Investments Ltd (GCP) 74.50p -3.75%
Raspberry PI Holdings (RPI) 692.75p -3.49%
Bytes Technology Group (BYIT) 446.20p -3.34%
Travis Perkins (TPK) 684.00p -2.77%
SThree (STEM) 250.50p -2.53%
OSB Group (OSB) 412.80p -2.50%
Drax Group (DRX) 641.50p -2.36%
Tate & Lyle (TATE) 632.00p -2.17%
Volution Group (FAN) 524.00p -2.06%
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