The FTSE 100 came off session lows but still struggled to find its groove heading into Tuesday afternoon, with share price falls for miners meaning it underperformed continental peers.
The FTSE 100 index was up just 3.00 points at 7,920.57. The FTSE 250 was up a more convincing 90.13 points, 0.5%, at 19,703.66, while the AIM All-Share was down just 0.02 of a point at 737.24.
The Cboe UK 100 was marginally up at 792.06, the Cboe UK 250 was up 0.5% at 17,120.72, and the Cboe Small Companies was up 0.3% at 14,660.84.
In European equities on Tuesday, the CAC 40 in Paris was up 0.2%, while the DAX 40 in Frankfurt was up 0.6%.
The FTSE 100 underperformed as investor digested news concerning China, a major buyer of minerals. Rio Tinto fell 1.2%, while Anglo American lost 0.9%.
The US, UK and New Zealand have accused Beijing-backed cyber groups of being behind a series of attacks against lawmakers and key democratic institutions - allegations that prompted angry Chinese denials.
In rare and detailed public accusations against China, a trio of Washington, London and Wellington described a series of cyber breaches over the last decade or more, in what appeared to be a concerted effort to hold Beijing accountable.
The US Justice Department charged seven Chinese nationals over what it said was a 14-year ‘prolific global hacking operation’ designed to aid China’s ‘economic espionage and foreign intelligence objectives.’
Washington said a unit, dubbed APT31, was behind the attacks, describing it as a ‘cyberespionage program’ run by China’s powerful Ministry of State Security out of the central city of Wuhan.
With Britain expected to hold a general election within months, UK Deputy Prime Minister Oliver Dowden also made a shock announcement that ‘a Chinese state-affiliated entity’ had likely ‘compromised’ the country’s Electoral Commission.
Sterling was quoted at $1.2661 at midday on Tuesday, higher than $1.2606 at the equities close on Monday. The euro traded at $1.0857 on Tuesday midday, higher than $1.0817 late Monday. Against the yen, the dollar was higher at JP¥151.35 versus JP¥151.27.
Focus this week will also be on a US inflation reading. The latest personal consumption expenditures data is released on Friday.
ActivTrades analyst Pierre Veyret said the looming data kept risk-off trade in check.
‘Risk appetite is taking a break this week ahead of Friday’s highly anticipated US PCE data, which is expected to provide traders with more clues regarding the outlook for monetary policy. Market sentiment is also affected by uncertainties on the corporate front; investors are starting to wonder whether the next slew of earning reports will support the extremely high stock valuations seen everywhere,’ Veyret added.
Stocks in New York were called higher. The Dow Jones Industrial Average was called up 0.2%, the S&P 500 index up 0.4%, and the Nasdaq Composite up 0.5%.
In the FTSE 100, Ocado was the top performing stock, rising 7.3%.
In the 13 weeks that ended March 3, the grocer and warehouse technology firm said Ocado Retail volumes rose 8.1% on-year, while retail revenue rose 11% to £645.3 million from £583.7 million.
Average orders per week rose 8.4%, while active customers across the period rose 6.4%.
Looking ahead, Ocado maintained its group annual revenue growth guide in the ‘mid-high single digits’ range.
‘Any joint enterprise doesn’t have the best prospects if participants are at odds with each other, but the Ocado Retail venture has enjoyed a robust period of trading despite the differences between partners Marks & Spencer and online groceries specialist Ocado. Sales were up and not just because of rising prices. The venture is actually seeing significant volume growth as it wins market share. This is partly because it saw less price inflation than the wider market,’ said AJ Bell analyst Russ Mould.
‘This positive trading comes after a long period of disappointing performance and you can understand Marks & Spencer’s frustration – when it agreed the tie-up with Ocado in 2019 it set targets which have subsequently not been met...At least the turnaround efforts at Ocado Retail appear to be bearing fruit.’
Marks & Spencer was up 1.7%.
Smiths Group rose 4.1%.
The engineering company operating in the energy, industrial, security and aerospace sectors said that a strong performance by its John Crane division had spared its interim results from a semiconductor market hit.
Revenue for the half-year ended January 31 reached £1.51 billion, in line with market expectations and inching up 0.7% from £1.50 billion a year prior. Pretax profit rose 2.4% to £171 million from £167 million.
Smiths has declared an interim dividend of 13.55p, up 5.0% from 12.9p a year before, and unveiled plans to commence a £100 million share buyback programme with immediate effect.
Looking ahead, Smiths reaffirmed its organic, medium-term revenue growth target of 4% to 6%.
Smiths also announced the appointment of Roland Carter as chief executive officer with immediate effect. Carter replaces Paul Keel, who has taken up a role as chief executive of a ‘US public company’.
Flutter Entertainment lost 0.4%, returning gains after a strong start. It talked up its US offering FanDuel, which it said achieved annual profit for the first time in 2023, as the Paddy Power and SkyBet owner gears up for a possible primary listing move to New York.
The bookmaker, which already trades on the New York Stock Exchange, would lose its FTSE 100 status if shareholders back the primary listing move in a May poll.
‘Flutter delivered a strong 2023 performance as we continued to deliver on our strategy,’ Chief Executive Peter Jackson said. ‘As anticipated, our number one position in the US has transformed the group’s earnings profile during 2023 as FanDuel delivered a positive US full year adjusted earnings before interest, tax, depreciation and amortisation for the first time.’
In 2023, Flutter achieved revenue of $11.79 billion, up 25% from $9.46 billion in 2022. Its pretax loss, however, stretched to $1.09 billion from $295 million.
However, Flutter achieved adjusted Ebitda growth of 45% to $1.87 billion from $1.29 billion.
Flutter said it has traded strongly so far in 2024, with revenue surging 23%. US revenue has jumped 56% so far, with sportsbook alone up 64%.
In the FTSE 250, Softcat jumped 9.2%.
The IT infrastructure and services provider said that it continued to see significant opportunities such as generative AI that it was focused on its long-term growth potential as it reported a profit increase.
Pretax profit rose 8.1% to £68.2 million in the six months to January 31, from £63.1 million a year prior. Revenue declined 8.8% to £467.2 million from £512.4 million, while cost of sales decreased 19% to £270.6 million from £335.4 million and administrative costs increased 14% to £129.8 million from £114.0 million.
The company declared an interim dividend of 8.5 pence per share, up 6.3% from 8.0p a year prior.
Softcat highlighted: ‘During the period, there was growing interest from customers in engaging with generative‐AI and the possibilities it offers, over time, to transform their operations...We continue to see significant and expanding opportunities in our market and will maintain our investment approach to building the team, infrastructure and tools to capitalise on this exciting and long‐term growth potential.’
Elsewhere in London, 888 rose 11%.
The sports betting and gambling company, whose brands include 888casino and William Hill, reported a pretax loss of £121.3 million for 2023, widening slightly from £115.7 million in 2022. Earnings per share dropped 55% to 12.6p from 28.3p.
Revenue surged 38% to £1.71 billion from £1.24 billion.
For this year, 888 proclaimed a ‘positive outlook’ for revenue, in line with its medium term targets, ‘with consistent growth in active players driving confidence in strong revenue growth online in both the UK and International segments’.
Brent oil was trading at $86.24 a barrel in London at midday on Tuesday, higher than $85.80 late Monday. Gold was quoted at $2,196.21 an ounce, higher than $2,164.77.
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