London close: Stocks mixed on US jobless claims, UK GDP growth
By Josh White
Date: Thursday 13 Feb 2025
(Sharecast News) - London stocks ended Thursday in mixed territory as investors assessed a fall in jobless claims across the pond, as well as an unexpected expansion in the UK economy.
The FTSE 100 index fell 0.49% to 8,764.72 points, while the FTSE 250 edged up 0.17% to 20,916.14 points.
In currency markets, sterling was last up 0.69% on the dollar to trade at $1.2532, as it gained 0.24% against the euro, changing hands at €1.2014.
"Tariffs and inflation remain the only two themes that investors care about," said IG chief market analyst Chris Beauchamp.
"Over the past 24 hours, the latter of those narratives seems to have lost its power.
"Despite stronger CPI and PPI readings, stocks have avoided a selloff, with US markets demonstrating remarkable resilience."
Beauchamp said US president Donald Trump's announcement of more tariffs failed to have much of an impact either, since they were delayed until the start of April.
"Investors have been strengthened in their belief that the tough talk on this front is more of a negotiating tactic."
Poorly-received figures from British American Tobacco, Unilever and Barclays meanwhile meant that the FTSE 100 could not hold the fresh record set in opening trading, Beauchamp added.
"Its weakness comes as a contrast to more strength in Europe.
"While still cheap, the prospect of a Ukraine deal seems to have bolstered the attraction of the region to investors, though the initial pop may well be a fad, given that even the start of negotiations may be some way off."
Jobless claims fall more than expected stateside, UK economy unexpectedly expands
In economic news, US jobless claims declined more than expected in early February, pointing to continued strength in the American labour market.
The Labor Department reported that initial claims fell by 8,000 to 213,000 in the week ended 8 February, exceeding forecasts of a smaller 6,000 decline.
Continuing claims also dropped to 1.85 million, below expectations of 1.88 million, while the four-week moving average, which smooths out volatility, edged down to 216,000.
The biggest increases in claims were recorded in New York, California, and Georgia, while New Jersey and Massachusetts saw the largest declines.
US wholesale inflation meanwhile picked up slightly at the start of 2025, with final demand prices rising 0.4% in January, slightly above expectations.
The prior month's inflation figure was revised upward to 0.5%.
Higher food and gasoline costs drove the increase, with food prices climbing 1.1% and gasoline surging 1.7%.
Service prices also rose by 0.3%, though trade-related inflation slowed after a stronger December.
On an annual basis, wholesale inflation held steady at 3.5%.
On home shores, the UK economy unexpectedly grew in the final quarter of 2023, avoiding contraction.
Official data showed GDP expanded by 0.1% in the three months to December, defying expectations for a 0.1% decline.
"The economy picked up in December after several weak months, meaning, overall, the economy grew a little in the fourth quarter of last year," said ONS director of economic statistics Liz McKeown.
"Across the quarter, growth in services and construction were partially offset by a fall in production. GDP per head, in contrast, fell back slightly in the quarter.
"In December wholesale, film distribution and pubs and bars all had a strong month, as did manufacturing of machinery and the often-erratic pharmaceutical industry."
The UK housing market meanwhile softened in January, according to a survey by the Royal Institution of Chartered Surveyors.
House prices continued to rise but at a slower pace, with a net balance of 22, down from 26 in December.
Short-term expectations also weakened, as the three-month outlook for prices dropped to a balance of 3 from 14.
However, long-term sentiment remained positive, with a net balance of 52 expecting price growth over the next year.
"Buyer demand lost a bit of momentum through the early part of the year, with this flatter picture likely linked to the turbulence seen across money markets in the first half of January," commented Tarrant Parsons, head of market analytics at RICS.
"Nevertheless, moving forward, respondents continue to envisage a slightly positive near-term outlook for sales activity.
"This should be further supported by the unwinding of some of the pressures around mortgage interest rates over the past couple of weeks."
On the continent, eurozone industrial production fell sharply in December, reversing a modest gain in the prior month.
Eurostat data showed a 1.1% decline, worse than the expected 0.6% drop.
The fall was driven by a 2.6% contraction in capital goods and a 1.9% drop in intermediate goods.
Across the broader EU, industrial output slipped 0.8%.
Coca-Cola HBC jumps, investors stub out British American Tobacco
On London's equity markets, British American Tobacco slumped 8.6% after reporting a 5.2% drop in full-year revenue, citing the impact of its exit from Russia and Belarus and unfavourable currency translation.
Despite swinging to a profit, the company's outlook as it transitioned toward a predominantly smokeless business by 2035 failed to reassure investors.
Rival Imperial Brands also fell 2.74%.
"It's all very well making grand pledges to be a 'smokeless business' by 2035 but it does beg the question of what's going to replace the revenue and cash flow provided by selling cigarettes, given it is this which allows the company to sustain generous dividends and share buybacks," said Russ Mould, investment director at AJ Bell.
"In 2024, areas like vaping and e-cigarettes contributed £250m out of its near-£12bn worth of adjusted operating profit.
"This clearly illustrates the size of the task over the next decade better than the company's observation that these areas of the business are now contributing some 17.5% of revenue."
Elsewhere, Unilever dropped 6.02% as the consumer goods giant warned of a slow start to the year amid subdued market growth.
While announcing a €1.5bn share buyback, the company's fourth-quarter underlying sales narrowly missed expectations.
Banking giant Barclays lost 4.97% despite reporting a 24% rise in full-year pre-tax profit to £8.11bn and unveiling a £1bn share buyback.
"A stable, dependable and progressive set of numbers such as these would normally fire the share price ahead, but given Barclays' recent run the height of expectation has turned into a temporary headwind," noted Richard Hunter, head of markets at Interactive Investor.
Food ingredients specialist Tate & Lyle tumbled 6.65% after warning of lower revenue for the upcoming financial year and guiding EBITDA growth toward the lower end of its forecast range.
Lancashire Holdings declined 4.77% as it estimated net ultimate losses of up to $165m related to the California wildfires.
Renishaw slid 10.47% despite posting a modest 3% revenue increase in the first half of its financial year.
On the upside, Coca-Cola HBC jumped 6.94% after forecasting a 7% to 11% rise in organic operating profit for 2024, supported by an expected 6% to 8% increase in organic revenue.
Analysts also projected double-digit growth in 2025 earnings before interest and taxes.
Ferrexpo climbed 4.63% amid optimism over potential peace talks between Ukraine and Russia.
Low-cost airline Wizz Air gained 4.77% after its chief executive indicated the airline was preparing to resume flights to Ukraine soon after any ceasefire announcement.
Housebuilder Vistry Group rose 4.33% following news that US hedge fund Abrams Capital Management increased its stake in the company to 10.2% from 8.2%.
Waste management firm Renewi surged 4.29% after agreeing to a £707m takeover by Macquarie Asset Management, with the deal representing a 57% premium to its share price before the offer period began.
Reporting by Josh White for Sharecast.com.
Market Movers
FTSE 100 (UKX) 8,764.72 -0.49%
FTSE 250 (MCX) 20,916.14 0.17%
techMARK (TASX) 4,758.25 -0.20%
FTSE 100 - Risers
Smurfit Westrock (DI) (SWR) 4,340.00p 8.31%
Coca-Cola HBC AG (CDI) (CCH) 3,190.00p 7.41%
Mondi (MNDI) 1,315.00p 5.20%
BAE Systems (BA.) 1,248.00p 3.18%
Diploma (DPLM) 4,754.00p 3.08%
CRH (CDI) (CRH) 8,412.00p 2.61%
Persimmon (PSN) 1,254.00p 2.45%
Diageo (DGE) 2,185.00p 2.39%
Antofagasta (ANTO) 1,842.00p 2.36%
Convatec Group (CTEC) 244.40p 2.35%
FTSE 100 - Fallers
British American Tobacco (BATS) 3,095.00p -8.81%
Unilever (ULVR) 4,483.00p -5.64%
Barclays (BARC) 293.25p -4.71%
Whitbread (WTB) 2,664.00p -2.92%
NATWEST GROUP (NWG) 437.00p -2.89%
Vodafone Group (VOD) 67.30p -2.63%
Imperial Brands (IMB) 2,814.00p -2.43%
Beazley (BEZ) 831.00p -2.18%
Shell (SHEL) 2,651.50p -1.85%
InterContinental Hotels Group (IHG) 10,625.00p -1.48%
FTSE 250 - Risers
Wizz Air Holdings (WIZZ) 1,687.00p 5.97%
Vistry Group (VTY) 626.00p 4.33%
Renewi (RWI) 851.00p 4.29%
Pennon Group (PNN) 472.20p 3.51%
SThree (STEM) 258.50p 3.19%
Burberry Group (BRBY) 1,191.00p 3.03%
Elementis (ELM) 159.60p 2.69%
Shaftesbury Capital (SHC) 124.30p 2.56%
Ferrexpo (FXPO) 93.10p 2.53%
Urban Logistics Reit (SHED) 115.40p 2.49%
FTSE 250 - Fallers
Renishaw (RSW) 3,160.00p -11.73%
Tate & Lyle (TATE) 590.00p -6.65%
Lancashire Holdings Limited (LRE) 599.00p -4.77%
The Renewables Infrastructure Group Limited (TRIG) 77.00p -3.88%
NextEnergy Solar Fund Limited Red (NESF) 66.20p -3.78%
WH Smith (SMWH) 1,238.00p -3.73%
Frasers Group (FRAS) 609.50p -3.41%
Diversified Energy Company (DEC) 1,330.00p -3.20%
Wood Group (John) (WG.) 65.25p -3.11%
Greencoat UK Wind (UKW) 114.90p -3.04%
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN