Equities in Europe ended higher on Thursday, overcoming some earlier uncertain trade, as comments from a US official calmed some geopolitical worries which kept a lid on investor enthusiasm.
Nonetheless, Brent remained above the $73 mark, supporting oil majors.
Moscow’s ambassador in London said Thursday Britain was ‘now directly involved’ in Russia’s war with Ukraine, following reports Kyiv had fired UK-supplied Storm Shadow missiles onto Russian territory for the first time.
‘Absolutely, Britain... is now directly involved in this war,’ Andrei Kelin told Sky News, adding ‘this firing cannot happen’ without UK and Nato support.
The FTSE 100 index added 64.20 points, 0.8%, at 8,149.27. The FTSE 250 rose 105.16 points, 0.5%, at 20,349.92, and the AIM All-Share rose 3.48 points, 0.5%, at 725.82.
The Cboe UK 100 ended up 0.9% at 819.81, the Cboe UK 250 added 0.3% at 17,801.27, and the Cboe Small Companies lost 0.5% at 15,570.66.
The CAC 40 in Paris spent most of the day in the red but recovered to close up 0.2%, while the DAX 40 in Frankfurt added 0.7%.
Supporting the FTSE 100 were share price gains for its heavyweights, including oil majors Shell and BP.
Shell and BP rose 0.8% and 1.9% as oil sat at lofty territory on simmering global tensions.
Brent oil was quoted at $73.52 a barrel late Thursday afternoon, up from $73.20 at the time of the London equities close on Wednesday, but off an intraday high of $74.34.
Russia’s strike on Ukraine was not an ICBM, but an ‘experimental’ medium-range ballistic missile, a US official said Thursday, playing down the significance of the attack.
‘Russia may be seeking to use this capability to try to intimidate Ukraine and its supporters... but it will not be a game changer in this conflict,’ the US official said.
Ukraine had accused Russia of launching an intercontinental ballistic missile attack at Ukraine for the first time on Thursday but without a nuclear warhead in a new escalation of the conflict.
British media meanwhile reported on Wednesday that Kyiv had launched UK-supplied Storm Shadow missiles at targets in Russia after being given the green light from London.
The defence ministry in Moscow said its air defence systems had downed two Storm Shadows, without saying whether they were downed on Russian territory or in occupied Ukraine.
Gold rose to $2,665.01 an ounce late Thursday from $2,648.58 on Wednesday.
The pound was quoted at $1.2605 late on Thursday afternoon in London, down from $1.2634 at the time of the European equities close on Wednesday. The euro stood at $1.0491, down from $1.0515. Against the yen, the dollar was trading at JP¥154.52, fading from JP¥155.36.
The single currency slumped as low as $1.0476 on Thursday, its worst level since October 2023.
‘The threat of escalation in Ukraine plus more soft European PMI numbers tomorrow is keeping the euro subdued,’ ING analysts commented.
Friday’s economic events calendar has a slew of flash composite purchasing managers’ index readings, including the eurozone at 0900 GMT, the UK at 0930 GMT and the US at 1445 GMT. There is also a German gross domestic product reading at 0700 GMT, the same time as UK retail sales data. Overnight, there is also a UK consumer confidence reading.
In London, JD Sports shares slumped 16%. It predicted annual profit will be at the lower end of guidance, as a decent start to its third quarter was hampered by a ‘volatile’ October.
Its pretax profit before adjusting items guidance range stands at £955 million to £1.04 billion.
Halma added 5.7%. The stock hit a three-year high on Thursday. It lifted its half-year payout and reported a rise in revenue and profit. The safety equipment maker said pretax profit in the six months to September 30 rose 16% on-year to £174.0 million from £150.2 million a year prior. Revenue climbed 13% to £1.07 billion from £950.5 million.
Elsewhere, Liontrust shot up 8.3%. The asset manager said there are a ‘number of reasons’ to assume the outlook for the sector is improving. It also announced a £5 million share buyback, kept its interim dividend at 22.0p per share and said it expects an unmoved annual payout of 72p.
Assets under management at its September 30 half-year end amounted to £25.96 billion, down 6.7% from £27.82 billion at the start of April. Net outflows amounted to £2.07 billion during the six months, though this was down from £3.21 billion a year prior.
Chief Executive Officer John Ions commented: ‘We are steadfast in our commitment to active management and to our partnership with clients through complementing their other strategies including passive investments. The headwinds facing many of our investment strategies are now being replaced by tailwinds including lower inflation and interest rates. We are seeing improved performance across our funds and we continue to have a strong brand and client engagement.’
The firm said it has made progress in ‘strengthening Liontrust’s technological, data and digital capability’.
The company added: ‘We have previously highlighted our investment in the new target operating model. This investment is enabling us to manage the business as efficiently as possible, including a proposed reduction in staff numbers of around 25 roles. These roles represent around 12% of the group across the business and across levels of seniority, which will save, if implemented in full, around £4.5 million and be implemented over the next few months. As part of this, we are also closing four funds that are sub-scale and for which there is insufficient demand.’
In New York, the Dow Jones Industrial Average was up 1.0% at the time of the European close. The S&P 500 was 0.4% higher, though the Nasdaq Composite lost 0.2%.
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