News that eurozone economic sentiment deteriorated in August helped the FTSE 100 outperform its European peers at midday on Wednesday.
The FTSE 100 index was up 24.21 points, 0.3%, at 7,489.20. The FTSE 250 was up 73.27 points, 0.4%, at 18,541.86, and the AIM All-Share was up 1.17 points, 0.2%, at 742.38.
The Cboe UK 100 was up 0.3% at 746.05, the Cboe UK 250 was up 0.3% at 16,219.08, and the Cboe Small Companies was down marginally at 13,416.78.
In European equities, the CAC 40 in Paris was down 0.6%, while the DAX 40 in Frankfurt was down 0.5%.
There was some bad news for the eurozone on Wednesday, as new data from the European Commission showed that economic sentiment deteriorated in August.
The economic sentiment indicator fell to 93.3 points from 94.5 in July. August’s reading was lower than the 93.7 expected by FXStreet-cited market consensus.
Still to come on Wednesday, there is a consumer price index reading from Germany at 1300 BST.
FXStreet are expecting consumer prices to rise by 6.0% in August annually, slowing from a 6.2% rise in July. On a month-on-month basis, prices are expected to rise by 0.3%, unchanged from July.
In the FTSE 100, housebuilders were on the rise, despite news that the housing market is slowing down. Persimmon was up 1.7%, Taylor Wimpey rose 1.4%, and Barratt Developments was up 0.8%.
The Bank of England reported that net mortgage approvals and approvals for remortgaging in the UK decreased in July.
Net mortgage borrowing by individuals was £200 million in July, up from £100 million in June and increasing for the third consecutive month.
Net mortgage approvals for house purchases decreased to 49,400 in July, from 54,600 in June. Meanwhile, approvals for remortgaging increased to 39,300 from 39,100 in June.
The best performer in the FTSE 100 at midday was Prudential, up 2.7%.
In the six months to June 30, the Asia-focused insurer swung to a pretax profit of $1.18 billion from a loss of $1.35 billion a year prior on an IFRS basis.
On an adjusted basis, operating profit rose by 3.5% to $1.46 billion from $1.41 billion the year before.
Despite Prudential noting strong business in both Hong Kong and mainland China, AJ Bell’s Russ Mould said mainland China has not delivered the boost that many people had expected this year following the relaxation of Covid-19 rules.
‘In theory, the long-term prospects for Prudential in the country look good as growing wealth should equate to greater demand for the financial services it offers. However, success does not come at the click of a finger and, like many big companies of its ilk, patience is required,’ he said.
On London’s AIM, Instem surged 40% to 826.83 pence.
Instem said it has agreed to a private equity takeover offer that values the life sciences IT company at just above £200 million. Specialist healthcare industry investor Archimed SAS has offered 833 pence in cash per Instem share, valuing the entire company at £203 million.
Instem said the takeover will allow it to take advantage of Archimed’s industry knowledge and network as a healthcare specialist investor.
Bidstack rose 20%.
The in-game advertising firm said it has partnered up with Venatus Media and will provide access to its video game advertising inventory of more than 400 games.
It said Venatus will be the ‘sole provider’ of direct sales of Bidstack’s inventory across the US, UK Germany, Canada, Australia and South Korea. Venatus is a London-based advertising platform.
Woodbois lost 15% after a military coup was declared in Gabon.
The Africa-focused forestry, timber trading and afforestation company noted recent reports of ‘government instability’, and said it will monitor the situation and provide any necessary updates relating to any significant delays in production.
Stocks in New York were called lower. The Dow Jones Industrial Average was called down 0.1%, the S&P 500 index down 0.2%, and the Nasdaq Composite down 0.3%.
On Tuesday, stocks on Wall Street had rallied, with the Dow Jones Industrial Average closing up 0.9%, the S&P 500 up 1.5% and the Nasdaq Composite up 1.7%.
Data from the US Bureau of Labor Statistics showed there were 8.827 million job vacancies in July, down from 9.165 million in June, and below a FXStreet-cited consensus of 9.465 million. It is the smallest number of openings since March 2021.
‘The weak data pushed the Federal Reserve hawks to the sidelines, and bolstered the expectation of a pause in September, and tilted the probabilities in favour of a no hike in November, as well,’ explained Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
Markets now see an 89% chance of the Fed holding rates steady at its next meeting in September, according to the CME Fed Watch Tool. On Friday, markets saw 80% chance of this outcome.
Further, markets had been anticipating a 25 basis point hike at its November meeting. However, the expectations of a hold jumped to 51% from 38% on Tuesday.
The data starts a week of updates on the jobs market with ADP private payrolls figures on Wednesday, weekly jobless claims data on Thursday and non-farm payrolls on Friday.
The pound was quoted at $1.2651 at midday on Wednesday in London, higher compared to $1.2616 at the equities close on Tuesday. The euro stood at $1.0888, up against $1.0845. Against the yen, the dollar was trading at JP¥146.36, higher compared to JP¥146.04.
Brent oil was quoted at $85.37 a barrel at midday in London on Wednesday, up from $84.24 late Tuesday. Gold was quoted at $1,937.49 an ounce, up slightly against $1,936.07.
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