European stocks were mixed on Wednesday morning, with the FTSE 100 trading resiliently, after China announced it will hold a fiscal policy-focused conference this weekend amid a backdrop of investor nerves for the Asian economy.
The FTSE 100 index was up 38.24 points, 0.5%, at 8,228.85.
London’s powerhouse listings AstraZeneca, Shell and Unilever were all in the green in early trade, aiding the FTSE 100. Drugmaker Astra rose 0.9%, oil major Shell 0.3% and consumer goods firm Unilever 0.7%. The trio represent some of the FTSE 100’s largest listings. Vistry, the index’s smallest following a deep sell-off of the stock on Tuesday, had little respite early on Wednesday, losing another 1.9%.
The FTSE 250 was up 53.70 points, 0.3%, at 20,684.90, but the AIM All-Share fell just 0.30 of a point to 734.77.
The Cboe UK 100 added 0.4% at 823.72, the Cboe UK 250 climbed 0.5% to 18,192.20, and the Cboe Small Companies was down 0.1% at 16,613.09.
In European equities on Wednesday, the CAC 40 in Paris was up 0.1%, though the DAX 40 in Frankfurt fell 0.2%.
In Tokyo, the Nikkei 225 ended up 0.9%, while Sydney’s S&P/ASX 200 added 0.1%. In China, the Shanghai Composite slumped 6.6%, while the Hang Seng in Hong Kong fell 1.4%.
‘Chinese authorities think that the country could achieve its 5% growth target with the stimulus measures that have already been announced, but investors not much so. On the contrary, the investor community was expecting that the government would announce a fiscal package of as much as 3 trillion yuan to complement the latest monetary measures to boost growth, but the Chinese authorities unveiled a laughable amount of 200 billion yuan in spending for next year. The worry is that the Chinese will throw money into the market without targeting troubled areas, and the lack of a fiscal leg to the Chinese stimulus package will hardly address the major issues,’ Swissquote analyst Ipek Ozkardeskaya commented.
China’s finance minister will hold a briefing this weekend focused on fiscal policy, authorities said Wednesday, as investors seek further action after a recent slew of measures aimed at reversing an economic slump.
Lan Fo’an will use Saturday’s news conference to outline ‘countercyclical adjustment of fiscal policy to promote high-quality economic development’, Beijing announced.
A barrel of Brent rose to $77.75 early on Wednesday, from $77.20 at the time of the European equities close on Tuesday. Gold climbed to $2,614.11 an ounce from $2,608.13.
Oil recovered some lost ground after tumbling as low as $76.24 a barrel on Tuesday on the China stimulus disappointment.
In New York, the Dow Jones Industrial Average closed up 0.3% on Tuesday. The S&P 500 rose 1.0%, while the Nasdaq Composite surged 1.5%.
The pound was quoted at $1.3080 early Wednesday, down from $1.3084 at the time of the London equities close on Tuesday. The euro climbed slightly to $1.0966 from $1.0963. Against the yen, the dollar was trading at JP¥148.48, up from JP¥148.32.
ING analysts commented: ‘Today, there is little data of note but tonight sees the release of the September [Federal Open Market Committee] minutes when the Fed cut 50bp. The market has already scaled back around 30bp from the 2024 Fed easing cycle over the last few weeks but equally we doubt investors are in the mood to re-price an aggressive Fed easing cycle just yet.’
The Fed minutes are released at 1900 BST.
In London, Mondi shares race 3.2% higher after announcing a deal to snap-up Schumacher Packaging assets.
The Weybridge, England-based packaging firm will buy the German, Benelux and UK corrugated converting and solid board operations of Schumacher Packaging. Benelux refers to Belgium, the Netherlands, and Luxembourg.
The deal is for an enterprise value of €634 million, which will be financed from Mondi’s existing facilities.
CMC Markets rose 5.7%. It expects to report a swing to first-half profit, as the provider of online financial trading hailed its ‘diversification strategy’.
For the half-year to September 30, it expects to report pretax profit of £51 million, swinging from a loss of £2 million.
Net operating income of around £180 million is expected, up 45% from £123 million a year prior.
What’s more, CMC expects to report operating costs of £113 million for the first half, trimmed from £122 million a year prior. The cost figure excludes ‘variable remuneration and non-recurring charges’.
Customer engagement software provider Netcall rose 4.8%. The company said revenue rose 8.4% to £39.1 million in the year to June 30, from £36.0 million. Its pretax profit increased 58% to £6.3 million from £4.0 million.
‘This year has been another period of strong performance for Netcall. Our cloud services continue to receive growing demand from new and existing customers, driving increased revenue visibility and strong cash flow,’ Chief Executive James Ormondroyd said.
Netcall lifted its final dividend to 0.89 pence per share from 0.83p.
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