The FTSE 100 shrugged off a subdued start to push higher at midday on Tuesday, although an underwhelming session for miners held back further gains.
The FTSE 100 index traded 27.12 points higher, or 0.3%, at 8,225.90. The FTSE 250 was down 17.71 points, 0.1%, at 21,120.97, while the AIM All-Share was down 1.33 points, 0.2%, at 781.91.
The Cboe UK 100 was up 0.3% at 821.39, the Cboe UK 250 was 0.2% lower at 18,444.32, and the Cboe Small Companies was up 0.1% at 17,336.13.
The CAC 40 in Paris rose 0.4%, while Frankfurt’s DAX 40 traded 1.1% higher. A share price rise of 6.8% for software firm SAP helped lift the DAX. SAP raised 2025 guidance overnight.
For the FTSE 100, however, the story of the morning was a ‘poor showing from the mining sector’, AJ Bell analyst Dan Coatsworth commented.
‘Copper futures have fallen by nearly 7% over the past five days amid concerns about sluggish demand from China as it struggles with a slowdown in economic growth. The market has taken the view that China isn’t digging deep enough with stimulus measures to fire up the economy and therefore commodities demand is at risk,’ the analyst said.
Glencore fell 1.3%, Anglo American lost 1.2%, Rio Tinto gave back 0.9% and Antofagasta was down 0.7%. They were among the worst FTSE 100 listed performers. Elsewhere in London, BHP fell 1.6%.
Rising in London, however, Compass added 5.0%. It said ‘industry trends remain strong’ as it reported an increase in revenue and raised growth guidance. In the third quarter ended June 30, organic revenue rose 10%.
‘As expected, net new business growth accelerated in Q3, whilst pricing moderated in line with inflation. Volumes continued to benefit from the quality of our offer and the value gap compared to the high street,’ Compass said.
Compass added: ‘We are pleased with our third quarter performance. The group delivered good growth across all regions and benefited from improved net new business in line with our expectations. For the full year we now expect underlying operating profit growth to be above 15% on a constant-currency basis with organic revenue growth above 10%.’
It had previously expected underlying operating profit growth ‘towards 15%’ and an organic revenue rise ‘towards 10%’.
Beazley rose 2.0%. It soothed some investor worry after a global IT glitch had prompted concern that the insurer could have been caught in the cross-hairs.
The FTSE 100 listing left its guidance for underwriting performance unchanged on Tuesday. This followed the global IT crash on Friday last week, caused by a faulty software update by cybersecurity firm CrowdStrike Holdings.
Beazley, noting that it is a leading cyber insurer, said that ‘based on what is known at this point’, the event will not change its guidance for an undiscounted combined ratio in the low-80s for 2024.
A combined ratio below 100 means a profit on underwriting, so the lower, the better. Beazley said it will profit an update with its first-half results on August 8.
Elsewhere in London, Fuller, Smith & Turner added 1.0%. The pub chain said inflation pressure is abating and its margins ‘are recovering’. Like-for-like sales grew 5.3% in the 16 weeks to July 20. This is the first 16 weeks of its financial year.
Fuller’s said trading momentum has continued, ‘with inflationary pressures easing, our margins are recovering’.
Chief Executive Simon Emeny said: ‘I am delighted to see our sales growth momentum continue, particularly against the backdrop of easing inflation, which will help us to grow margins and profit, as well as revenue. You can feel the positivity across the business, with our team members working energetically to drive our continued success. We have had a strong start to the financial year, and we look forward to the opportunities the future will bring. We have a new UK government in place, and I urge Sir Keir Starmer to stand by his commitment to overhaul our archaic business rates system. The Labour Party has a clearly stated objective to grow the economy and the hospitality sector can be an excellent engine to help deliver that growth.’
Stocks in New York are set for a mixed open. The Dow Jones Industrial Average and S&P 500 are called up 0.1%, and the Nasdaq Composite down 0.1%.
XTB analyst Kathleen Brooks commented: ‘The political race has become much closer due to the resignation of Joe Biden. However, both candidates are known quantities, so whoever wins the race for the White House, the market, in some ways, knows what to expect. For example, Kamala Harris may continue the policies of Joe Biden, and everyone expects President Trump to cut taxes and to implement trade barriers. This could be beneficial if it means more semiconductors are made on American shores, but it could be negative if it stops other goods being sold abroad. Thus, politics could be less of a driver for markets for the rest of the summer now that the Democrats are back in the race.’
On the corporate front, the analyst noted earnings from Alphabet are due after the closing bell in New York.
‘The main concern is AI. Will this earnings season show that AI is generating profits and boosting corporate bottom lines, instead of being a constant drag on investment spend? Alphabet‘s results later tonight are worth watching closely,’ Brooks added.
The pound traded at $1.2893 early Tuesday afternoon, down from $1.2913 at the time of the London equities close on Monday. Against the dollar, the euro faded to $1.0861 from $1.0881. Versus the yen, the dollar faded to JP¥156.07 from JP¥156.88.
Brent oil was quoted at $82.13 a barrel, down slightly from $82.15 at the time of the London equities close on Monday. Gold was quoted at $2,407.35 an ounce, up against $2,397.10.
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