The FTSE 100 saw mixed fortunes on Friday, with stronger-than-expected Chinese economic data boosting miners, though housebuilders suffered on stamp duty speculation.
The FTSE 100 index closed down 26.88 points, or 0.3%, at 8,358.25. The FTSE 250 ended up 48.66 points, or 0.2%, at 21,149.58, and the AIM All-Share lost 1.70 points, 0.2%, at 740.69.
For the week, the FTSE 100 added 1.3%, the FTSE 250 rose 1.9% and the AIM All-Share gained 0.9%.
The Cboe UK 100 closed down 0.4% at 836.51 on Friday, the Cboe UK 250 ended a touch lower at 18,660.73, and the Cboe Small Companies fell 0.2% at 16,954.00.
In European equities on Friday, the CAC 40 in Paris and Frankfurt’s DAX 40 rose 0.4%.
In New York, the Dow Jones Industrial Average was down 0.2%, the S&P 500 was up 0.3% and the Nasdaq Composite added 0.6%.
Keeping a lid on the FTSE 100, housebuilders fell. Vistry shed 2.3%, while Persimmon lost 1.7%.
UK Chancellor Rachel Reeves is said to be considering bringing a stamp duty discount introduced by the Tories to an end, the Times newspaper reports, which is expected to raise £1.8 billion a year by 2029.
Under Tory leadership, the threshold for stamp duty on home purchases was lifted to £250,000 from £125,000. For first time buyers, it rose to £425,000 from £300,000.
The Times reported that this month’s budget will confirm the increased nil rate on stamp duty will end in March. The newspaper reported that this move will raise the government £1.8 billion a year by 2029-30.
Closing higher, however, miners climbed. Anglo American added 1.8%, while Antofagasta rose 1.5%. Miners were boosted by better-than-expected Chinese data. Asia-focused insurer Prudential climbed 2.8%.
Overnight, China posted its slowest growth in a year and a half. The National Bureau of Statistics said the economy expanded 4.6% year-on-year in the third quarter, easing from 4.7% in the prior three months. However, this was slightly ahead of the 4.5% growth predicted by analysts surveyed by AFP.
‘We would downplay the importance of better-than-expected key economic indicators in September, given that the structural weakness in the property and household sectors remains largely unaddressed. We maintain our 2024 GDP growth forecast at 4.8% year-on-year. The recently announced stimulus measures could cushion the downside risks to next year’s growth, but are unlikely to reverse the structural downturn,’ Oxford Economics analyst Betty Wang commented.
The pound was quoted at $1.3040 late Friday afternoon in London, up compared to $1.3014 at the equities close on Thursday. The euro stood at $1.0858, higher against $1.0838. Against the yen, the dollar was trading at JP¥149.54, down compared to JP¥149.94.
The euro recovered some ground after fading following a European Central Bank rate cut, while the yen pushed the dollar back below JP¥150, a threshold it crossed on Thursday for the first time in over two months.
Supporting the pound, retail sales in the UK climbed 0.3% monthly in September, slowed from 1.0% in August but beating FXStreet-cited expectations of a 0.3% contraction.
Retail sales rose 3.9% on-year in September, the fastest annual rise since February 2022, and beating growth of around 2.3% in August. September’s on-year growth was also comfortably ahead of expectations of a 3.2% climb.
‘Despite this increased confidence, and less pressure on people’s pounds than this time last year - a new budget is on the horizon and customers will be wary of overspending, likely saving their cash for the Black Friday sales,’ BJSS analyst Charles Hope commented.
Brent oil was quoted at $72.45 a barrel on Friday, down from $74.25 late Thursday. Gold was quoted at $2,717.31 an ounce, up against $2,693.53. Bullion spiked to a record high above $2,720 on Friday.
Tracking the gold price higher, precious metal miners Fresnillo and Centamin rose 2.7% and 2.1%.
Publisher Future tumbled 19%. Chief Executive Officer Jon Steinberg informed the board of his decision to step down later next year, having only joined in April 2023.
Steinberg has resigned in order to relocate back to the US with his family. His notice period is twelve months and the board will now launch a search for his successor, the online magazine publisher and owner of price comparison website Go Compare said.
boohoo slumped 8.4% as it announced a CEO departure as well. John Lyttle intends to step down, but will support an orderly transition to a new successor.
The online only retailer said that revenue fell 15% to £620 million in the six months to August 31, from £729 million a year ago. Gross merchandise value was down 7.3% to £1.18 billion from £1.27 billion. Adjusted earnings before interest, tax, depreciation and amortisation declined 32% to £21 million from £31 million.
The Manchester-based firm also launched a strategic review amid the downturn in sales. It said there is ‘potential to unlock shareholder value’ and that it is ‘exploring options to deliver on this.’
Executive Chair Mahmud Kamani said the board is ‘focused’ on ensuring it takes the right steps in the interest of all its stakeholders.
‘The starting gun has been fired on the break-up of boohoo. A review of each division to ’unlock and maximise shareholder value’ is code for corporate restructuring and that points to a sale or demerger of some of its assets,’ AJ Bell analyst Russ Mould commented.
‘Selling Karen Millen and Debenhams is the obvious starting point, leaving Boohoo with a sharper focus on a younger target market. The company is under pressure to stop the rot with its disastrous share price since 2021. It has suffered from heightened competition, changing consumer buying habits, cost pressures and regularly falling short with meeting earnings expectations. These issues have weighed on the company’s valuation. When boohoo talks about unlocking shareholder value, it means getting someone to put a fairer price on certain divisions by separating them from the parent group. In doing so, they wouldn’t carry the stigma and valuation discount that comes with being part of a flagging retail group. It looks like chief executive John Lyttle has decided he doesn’t want to be around for the break-up.’
Monday’s economic calendar has a China interest rate announcement overnight.
In the local corporate calendar, Tristel, an infection prevention products manufacturer, releases annual results.
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