London open: FTSE falls despite better-than-expected GDP data
By Michele Maatouk
Date: Thursday 15 May 2025
(Sharecast News) - London stocks fell in early trade on Thursday despite better-than-expected UK GDP figures, as declining oil prices weighed on energy firms and as investors sifted through another raft of corporate news.
At 0830 BST, the FTSE 100 was down 0.4% at 8,549.40.
Data released earlier by the Office for National Statistics showed that the economy grew more than expected in the first three months of the year.
Gross domestic product rose 0.7% in the first quarter, up from 0.1% growth in the final quarter of last year and ahead of consensus expectations for 0.6% growth.
The ONS said growth was driven largely by a 0.7% increase in the services sector, while production grew 1.1% and the construction sector showed no growth.
ONS director of economic statistics Liz McKeown said: "The economy grew strongly in the first quarter of the year, largely driven by services, though production also grew significantly, after a period of decline.
"Growth in services was broad based, with wholesale, retail and computer programming all having a strong quarter as did car leasing and advertising. These were only slightly offset by falls in education, telecoms and legal services."
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "The FTSE 100 is on the back foot in early trade, as lower crude prices weigh on energy stocks. The better-than-expected growth snapshot also appears to have underwhelmed investors.
"UK GDP data may have surprised on the upside, but the upswing in activity risks fizzling out given the uncertainty on the horizon. There was a surge in business investment during the quarter, after a fall at the end of last year. With the threat of tariffs hovering which looked set to push up prices, it looks like there was a spell of buying of machinery and IT. Higher payroll costs came into force in April which looks set to see businesses reining in spending this quarter. It was a brighter picture for consumer facing services overall, with output rising 0.9% in the three months to March.
"But it's still been tough for the food and beverage trade with activity shrinking slightly. However, with the sun shining since April, and pay growth still beating inflation, there will be hopes that the feel-good factor may be re-emerging for retail and hospitality in the second quarter."
In equity markets, Sage Group slumped even as the enterprise software firm extended its share buyback plan by £200m after a strong first half. Underlying total revenues rose by 9% year-on-year to £1.24bn in the six months to 31 March, while underlying operating profits jumped 16% to £288m.
3i Group fell sharply as its full-year total return of £5bn missed market expectations.
Oil giants BP and Shell gushed lower as oil prices slid. Streeter said: "Falling oil prices have put pressure on listed energy giants, as concerns about oversupply in the market swirl. Brent Crude has ticked down by more than 3% to trade below $64 a barrel.
"Just as traders were processing data that showed a big surge in US crude stockpiles, the potential for a US-Iran deal is increasing forecasts of a glut in global oil supplies."
Spectris and PageGroup both lost ground as they traded without entitlement to the dividend.
On the upside, JD Sports was the top performer on the FTSE 100 following a report that US peer Dick's Sporting Goods is nearing a deal to buy Foot Locker for around $2.3bn.
National Grid and United Utilities were among the top gainers after full-year results.
Grainger was up as the residential landlord said first-half earnings rose 23% while net rental income was 15% higher than the same period a year earlier.
Watches of Switzerland rallied as it reported a jump in full-year revenues as it returned to growth in the UK and US.
Market Movers
FTSE 100 (UKX) 8,549.40 -0.41%
FTSE 250 (MCX) 20,795.47 -0.12%
techMARK (TASX) 4,658.09 -0.42%
FTSE 100 - Risers
JD Sports Fashion (JD.) 92.86p 3.15%
National Grid (NG.) 1,042.50p 2.66%
United Utilities Group (UU.) 1,089.00p 1.73%
Smurfit Westrock (DI) (SWR) 3,483.00p 1.55%
Compass Group (CPG) 2,576.00p 1.42%
easyJet (EZJ) 552.80p 1.13%
International Consolidated Airlines Group SA (CDI) (IAG) 319.60p 1.04%
Severn Trent (SVT) 2,616.00p 0.93%
F&C Investment Trust (FCIT) 1,103.00p 0.91%
Kingfisher (KGF) 315.30p 0.73%
FTSE 100 - Fallers
The Sage Group (SGE) 1,217.00p -4.88%
3i Group (III) 4,000.00p -4.69%
Admiral Group (ADM) 3,184.00p -4.56%
BP (BP.) 364.70p -4.28%
Shell (SHEL) 2,458.50p -2.23%
Tesco (TSCO) 360.90p -1.96%
Antofagasta (ANTO) 1,843.00p -1.68%
Glencore (GLEN) 269.15p -1.68%
Anglo American (AAL) 2,164.00p -1.66%
Fresnillo (FRES) 966.50p -1.53%
FTSE 250 - Risers
Grainger (GRI) 227.50p 6.56%
Watches of Switzerland Group (WOSG) 418.80p 6.29%
Serco Group (SRP) 182.80p 4.46%
Big Yellow Group (BYG) 1,012.00p 2.12%
Breedon Group (BREE) 465.00p 2.06%
Workspace Group (WKP) 456.50p 2.01%
Urban Logistics Reit (SHED) 153.40p 1.99%
Crest Nicholson Holdings (CRST) 188.90p 1.94%
Foresight Group Holdings Limited NPV (FSG) 403.00p 1.90%
RIT Capital Partners (RCP) 1,914.00p 1.59%
FTSE 250 - Fallers
Spectris (SXS) 2,090.00p -4.39%
Senior (SNR) 152.80p -4.38%
Petershill Partners (PHLL) 215.00p -3.59%
Energean (ENOG) 922.50p -3.10%
Future (FUTR) 735.00p -2.91%
Trustpilot Group (TRST) 245.00p -2.85%
JTC (JTC) 890.00p -2.73%
Pagegroup (PAGE) 280.20p -2.51%
Harbour Energy (HBR) 176.30p -2.38%
Zigup (ZIG) 330.50p -2.36%
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