Stock prices were higher in London, Paris and Frankfurt on Thursday, while the UK got a boost in a flash purchasing managers’ index reading, ahead of weekly US jobless data.
The FTSE 100 index was up 11.79 points, 0.1%, at 8,295.22. The FTSE 250 was down 18.70 points, 0.1%, at 21,168.49, and the AIM All-Share was down 0.54 points, 0.1%, at 776.27.
The Cboe UK 100 was up 0.2% at 829.44, the Cboe UK 250 was up 0.2% at 18,577.05, and the Cboe Small Companies was up 0.1% at 16,920.11.
In European equities on Thursday, both the CAC 40 in Paris and the DAX 40 in Frankfurt were up 0.3%.
The UK got a boost in both its manufacturing and service sectors in August, new flash data on Thursday showed.
The latest S&P Global flash UK composite purchasing managers’ index rose to 53.4 points in August, up from 52.8 points in July. According to FXStreet, markets were expecting the figure to edge up to just 52.9.
Pushing further above the 50-point neutral mark, and to a four-month-high, the data suggests the nation’s private sector growth quickened this month. The headline index has now posted above the 50.0 no-change threshold for ten consecutive months.
The composite reading is calculated using the services and manufacturing scores. Both the services and manufacturing economies remained in growth territory.
The flash services PMI rose to a four-month high of 53.3 points in August from 52.5 a month earlier. The manufacturing PMI edged up to a 26-month high of 52.5, up from 52.1.
Investors will now be eagerly waiting for the Jackson Hole symposium to kick off today in Wyoming, and for the further guidance that may come with Fed Chair Jerome Powell’s speech on Friday.
The annual gathering, which runs for three days, is hosted by the Federal Reserve Bank of Kansas City at Jackson Hole, Wyoming, and attended by central bankers from around the world.
On Wednesday, minutes from the July Federal Open Market Committee meeting showed the ‘vast majority’ of participants ‘observed that, if the data continued to come in about as expected, it would likely be appropriate to ease policy at the next meeting.’
However, ‘several’ officials mulled a move in July, amid the risk of acting ‘too late or too little’.
‘The Fed might have given its strongest signal yet that it is ready to start cutting interest rates, but the market isn’t going all-in with its bet on monetary policy,’ said Dan Coatsworth, investment analyst at AJ Bell.
‘Traders are still only pricing in a 67.5% probability of a US rate cut at the Fed’s next meeting on 18 September. One could argue that is quite low given weak jobs data strengthens the argument to cut now. In theory, this narrative warrants a much higher percentage probability for a cut in the cost of borrowing.’
Stocks in New York were called higher ahead of the gathering. The Dow Jones Industrial Average, the S&P 500 index, and the Nasdaq Composite were all called up 0.1%.
The pound was quoted at $1.3122 at midday on Thursday in London, higher compared to $1.3020 at the equities close on Wednesday. The euro stood at $1.1144, up against $1.1138. Against the yen, the dollar was trading at JP¥145.83, higher compared to JP¥145.35.
In the FTSE 100, JD Sports Fashion jumped 6.4%, making it the star performer.
The Lancashire, England-based sports fashion retailer said like-for-like sales rose 2.4% in the 13 weeks to August 3, improving from a fall of 0.7% in the first quarter.
On an organic basis in the recent quarter, sales climbed 8.3%, with North America sales up 14%, and Europe and Asia Pacific up 11%. UK organic sales growth lagged at just 1.2%.
Peel Hunt said the update was ‘somewhere between reassuring to good, with [like-for-like] improving in all areas and material market share gains.’
In the FTSE 250, Hays rose 2.4%.
In the financial year to June 30, the London-based recruitment company said pretax profit plunged to £14.7 million from £192.1 million a year prior.
During the period, Hays booked a £42.2 million cash exceptional charge related to ongoing restructuring of the business. It also incurred £37.8 million in non-cash asset write downs relating to the partial impairment of goodwill in its US business and the impairment of finite-lived intangible assets.
Chief Executive Dirk Hahn explained: ‘We saw increasingly challenging market conditions through [financial 2024] in both perm and temp, with low confidence levels and longer-than-normal ’time-to-hire’, and our profitability was significantly impacted, including our three largest markets of Germany, Australia and the UK.’
Amongst London’s small-caps, Macfarlane lost 3.3%.
The packaging firm reported revenue of £129.6 million in the first half of the year, down from £141.6 million a year earlier. Pretax profit fell to £9.7 million from £10.0 million.
Macfarlane upped its interim dividend to 0.96p from 0.94p.
It explained that the ‘challenging market conditions’ experienced in the latter part of 2023 have continued in 2024.
Brent oil was quoted at $76.33 a barrel at midday in London on Thursday, down from $77.29 late Wednesday. Gold was quoted at $2,507.20 an ounce, lower against $2,507.72.
Still to come on Thursday’s economic calendar, there is the weekly initial jobless claims data from the US due out at 1330 BST.
There is also a US flash composite PMI data out at 1445 BST.
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