Stock prices in London were in the green at midday, as investors awaited the next interest rate call from the European Central Bank, while UK Prime Minister Keir Starmer hosted leaders from across Europe at a summit.
The FTSE 100 index was up 59.33 points, or 0.7%, at 8,246.78. The FTSE 250 was up 151.37 points, or 0.7%, at 21,244.71, and the AIM All-Share was up 2.77 points, or 0.4%, at 789.57.
The Cboe UK 100 was up 0.6% at 822.67, the Cboe UK 250 was up 0.8% at 18,525.86, and the Cboe Small Companies was up 0.3% at 17,343.69.
Investors are waiting for a key interest rate decision by the European Central Bank, due at 1315 BST.
The consensus among economists is that the ECB will keep rates stable and then reduce them at the next decision in September. Currently, the main refinancing rate stands at 4.25%.
In politics, the European Parliament will vote later on a second term for Ursula von der Leyen, who is a member of the centre-right European People’s Party. The current president of the European Commission, von der Leyen needs to get a majority of at least 361 votes in the 720-seat chamber to be re-elected.
Also on Thursday, British Prime Minister Keir Starmer vowed to work with his European counterparts to reset ties soured by Brexit, as he hosted leaders from across the continent at a summit.
‘We want to work with all of you to restore relationships, rediscover our common interest and renew the bonds of trust and friendship that binds the fabric of European life,’ Starmer said at the start of the meeting at Blenheim Palace.
In European equities on Thursday, the CAC 40 in Paris was up 0.6%, and the DAX 40 in Frankfurt was up 0.2%.
Stocks in Europe enjoyed a boost, even after data from Eurostat showed that Eurozone construction production declined on both an annual and monthly basis in May.
Construction output in the single currency area weakened 0.9% in May from April, following a revised 0.4% decline in April from March. April’s monthly decline originally had been estimated at 0.2%.
Annually, output slid by 2.4% in May, worsening from a 1.5% decline in April. May is the fourth successive month when construction production in the eurozone has fallen year-on-year.
The pound was quoted at $1.2989 at midday on Thursday in London, lower compared to $1.3008 at the equities close on Wednesday. The euro stood at $1.0930, down against $1.0934. Against the yen, the dollar was trading at JP¥156.40, lower compared to JP¥156.60.
In the FTSE 100, Frasers gained 9.1%.
The retailer celebrated a ‘break-out year’ for building future growth, after posting adjusted pretax profit of £544.8 million for the twelve months ended April 28, up 13% from £481.8 million a year prior. This result, Frasers reflected, was at the top of its guidance range.
Meanwhile, pretax profit from continuing operations fell 21% to £507.0 million from £638.0 million, while revenue fell 0.9% to £5.54 billion from £5.59 billion. Looking ahead, the retailer expects adjusted pretax profit for financial 2025 of between £575 million and £625 million.
In the FTSE 250, IP Group gained 0.4%. The firm enjoyed slight gains after its portfolio company, Intelligent Ultrasound Group, firmed plans to sell its clinical artificial intelligence business to GE HealthCare for £40.5 million.
The deal excludes the NeedleTrainer and NeedleTrainer Plus products, which will remain with Intelligent Ultrasound, along with its Simulation business. Intelligent Ultrasound shares jumped 36% following the news.
On AIM, Alumasc gained 17%.
The Kettering, England-based supplier of building and engineering products updated its annual underlying pretax profit expectations for the year ended June 30 to be at least £12.6 million, compared to £11.2 million a year prior.
This uplift was down to the ‘significant outperformance of UK construction markets’, Alumasc explained, with overall organic revenue growth of around 6.5%. Accordingly, financial 2024 revenue, operating margins, and profit are all expected to be ahead of financial 2023 across all three divisions.
Stocks in New York were called predominantly higher. The Dow Jones Industrial Average was seen 0.1% lower, while the S&P 500 index and the Nasdaq Composite were called 0.1% and 0.4% higher respectively.
US President Joe Biden tested positive for Covid with mild symptoms Wednesday, shortly after conceding he would consider dropping his re-election bid if doctors diagnosed him with a serious medical condition, reported AFP.
The infection comes at a critical moment for Biden’s campaign, with the president seeking to show he is up to the job after a debate against rival Donald Trump sparked concerns about his health, and calls from some Democrats for him to step aside.
Biden was forced to cancel a speech to a union representing Latino workers who will be crucial for his election bid, having attended a campaign event earlier in the day and given a radio interview.
On the other side of the metaphorical aisle, Trump’s running mate, JD Vance, delved into his personal history for a speech at the Republican convention on Wednesday.
Vance, who famously chronicled his difficult upbringing in best-selling memoir ’Hillbilly Elegy’, reflected on how his Ohio hometown had been blighted by closed factories and addiction.
Of his grandmother, he said: ‘When we went through her things we found 19 loaded handguns...They were stashed all over her house – under her bed, in her closet, in the silverware drawer...this frail old woman made sure that no matter where she was, she was within arm’s length of whatever she needed to protect her family.’
Brent oil was trading at $84.98 a barrel early on Thursday, higher than $84.80 late Wednesday. The black stuff enjoyed a boost, after rallying ‘ on the back of an almost 5-million-barrel fall in US oil inventories last week’, according to Swissquote’s Ipek Ozkardeskaya.
‘Trump’s ambitions to boost the US oil production could be a turn off for oil bulls. But the Trump trade on oil is not that clear. Yes, Trump wants to pump more, but he also wants to scrap the shift toward alternative energy sources and keep demand for fossil fuel intact. Therefore, a Trump win could be more positive for oil than the contrary,’ added Ozkardeskaya.
Gold was quoted at $2,463.20 an ounce, lower than $2,464.08.
Still to come on Thursday’s economic calendar, there is an interest rate decision from the European Central Bank at 1315 BST.
Later in the day, there is a handful of data from the US, including initial jobless claims, the Philadelphia Fed manufacturing index, and the Conference Board leading index. Federal Reserve Governor Michelle Bowman is also due to make a speech.
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