London stocks were mixed but broadly positive at midday Thursday, as Bank of England data showed an unexpectedly large increase in UK mortgage approvals.
The FTSE 100 index was up 19.99 points, 0.3%, at 7,644.97. The FTSE 250 was up 82.15 points, 0.4%, at 19,095.73, and the AIM All-Share was down 0.44 of a point, 0.1%, at 737.60.
The Cboe UK 100 was up 0.4% at 766.43, the Cboe UK 250 was up 0.6% at 16,466.88, and the Cboe Small Companies was down 0.2% at 14,424.36.
In European equities on Thursday, the CAC 40 in Paris was up 0.1%, while the DAX 40 in Frankfurt was up 0.5%.
Eyes are firmly on a key US inflation reading on Thursday, which will be released at 1330 GMT.
According to FXStreet-cited consensus, the headline annual personal consumption expenditures inflation rate is expected to ease to 2.4% in January, from 2.6% in December. The core reading, the Fed’s preferred inflationary gauge, should ebb to 2.8% from 2.9%.
AJ Bell’s Russ Mould said: ‘A big release out later which investors will be watching closely is the core PCE reading of US inflation. This is the Federal Reserve’s preferred measure of prices. A higher-than-anticipated reading could put the final nail in the coffin of the idea of a pivot to rate cuts before the summer.’
On Wednesday, data showed that the US economy grew at a slightly weaker pace than previously expected in the final quarter of 2023.
According to a second estimate from the Bureau of Economic Analysis, real gross domestic product increased by 3.2% quarter-on-quarter on an annualised basis in the three months to December 31.
Stocks in New York were called to open lower. The Dow Jones Industrial Average was called down 0.3%, the S&P 500 index down 0.2%, and the Nasdaq Composite down 0.1%.
Already on Thursday, numbers from the Bank of England showed that UK mortgage approvals increased on a monthly basis in January.
Net mortgage approvals for house purchases rose to 55,200 in January from 51,500 in December. This was higher than FXStreet-cited market consensus of an increase to 52,000 approvals.
The effective interest rate on newly drawn mortgages eased to 5.19% in January from 5.28% in December.
The BoE’s own benchmark interest rate is currently 5.25%, where it has stood since August.
The pound was quoted at $1.2663 at midday on Thursday in London, higher compared to $1.2656 at the equities close on Wednesday. The euro stood at $1.0841, higher against $1.0835. Against the yen, the dollar was trading at JP¥150.04, lower compared to JP¥150.73.
In the FTSE 100, the top performer was Howden Joinery, up 8.1%.
The London-based kitchen and joinery supplier said pretax profit dropped 19% in 2023 to £327.6 million from £405.8 million. It said that this included £17 million of additional costs relating to a 53rd week. Before these costs, pretax profit was down 15%.
Revenue fell 0.3% to £2.31 billion in 2023 from £2.32 billion a year earlier.
On the back of the results, Howden upped its dividend by 1.9%, bringing the total dividend for the year to 21.0p, up from 20.6p.
Haleon rose 5.4%.
The Surrey, England-based consumer healthcare company said revenue for 2023 was up 4.1% to £11.30 billion from £10.86 billion in 2022, an 8.0% increase at an organic rate.
This was in spite of an adverse foreign exchange impact of £416 million, Haleon said, driven by the strengthening of the sterling against the Argentine peso, Chinese renminbi and other currencies.
Pretax profit was up 0.6% to £1.63 billion from £1.62 billion, while operating profit rose 9.4% to £2.00 billion from £1.83 billion.
In the FTSE 250, Drax Group rose 9.6% to the top of the index.
The Yorkshire, England-based electricity company said profit multiplied in 2023 to £796 million from £78 million a year prior.
Revenue rose 4.5% to £8.13 billion from £7.78 billion. Cost of sales meanwhile decreased 12% to £5.97 billion from £6.75 billion. Operating and administrative expenses increased 31% to £711.7 million from £542.8 million.
The company declared a final dividend of 13.9 pence per share, up 10% from 12.6p a year ago. This brings the total dividend to 23.1p, up 10% from 21.0p.
Amongst London’s small-caps, Wincanton shares were up 19% to 608.00p each.
The logistics provider has received a rival takeover offer from GXO Logistics.
Under the offer, Wincanton shareholders will receive 605p per share. The acquisition price values Wincanton at approximately £762 million on a fully diluted basis, and at around £764 million on an enterprise value basis.
On Monday, Wincanton accepted a revised, increased bid from CEVA Logistics. The new offer from CEVA, worth 480p per share, values Wincanton at £604.7 million on a fully diluted basis. CEVA is a subsidiary of CMA CGM, a shipping and logistics company based in Marseille, France.
Brent oil was quoted at $81.84 a barrel at midday in London on Thursday, up from $81.78 late Wednesday. Gold was quoted at $2,031.02 an ounce, lower against $2,033.68.
As well as the US PCE index reading later on Thursday, there is an inflation reading from Germany at 1300 GMT.
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