London stock prices mostly recovered on Thursday from the threat of higher for longer US interest rates, while initial jobless claims remained stable.
The FTSE 100 index closed up 29.06 points, 0.4%, at 7,877.05. The FTSE 250 ended up 110.53 points, 0.6%, at 19,450.67, and the AIM All-Share closed up 2.17 points, up 0.3%, at 745.29.
The Cboe UK 100 ended up 0.2% at 786.93, the Cboe UK 250 closed up 0.3% at 16,833.88, and the Cboe Small Companies ended marginally up at 14,776.22.
US jobless claims were steady in the most recent week, according to the US Department of Labor.
In the week ending April 13, US initial jobless claims were unchanged from the previous week’s revised level at 212,000. The previous week’s level was revised up by 1,000 from 211,000.
This was lower than market consensus for initial jobless claims to rise to 215,000.
The four-week moving average was 214,500, unchanged from the previous week’s revised average. The previous week’s average was revised up by 250 from 214,250.
Stocks in New York were higher at the London equities close, with the DJIA up 0.8%, while the S&P 500 index and the Nasdaq Composite were both up 0.5%.
In European equities on Thursday, the CAC 40 in Paris and the DAX 40 in Frankfurt both ended up 0.5%.
Global equities began to recover, with most major indices down on-week.
‘Fears that interest rates will stay higher for longer, as inflation stubbornly does the same, mean the yield on government bonds are also refusing to go down and that in turn is starting to put a little pressure on share prices,’ said AJ Bell analyst Russ Mould.
‘This is partly because investors can grab a higher yield on certain UK gilts or US Treasuries than they can from headline share indices and do so for less risk, at least in theory.’
Against the dollar, sterling rose to $1.2464 at the London equities close on Thursday, from $1.2447 late Wednesday. The euro was up at $1.0660, from $1.0637. Against the yen, the buck bought JP¥154.60, down from JP¥154.67.
In London’s FTSE 100, British Airways parent International Consolidated Airlines Group rose 4.3% in a positive read-across from budget airline easyJet.
easyJet rose 2.3%, after it reported a ‘positive outlook’ for the remainder of its financial year, and said its ‘seasonal’ losses eased in the first half. Sales amounted to €819.6 million in the quarter, down 9.3% from €903.2 million a year prior.
In the six months to March 31, revenue surged 22% to £3.27 billion from £2.69 billion. Its headline pretax loss slimmed to £350 million from £411 million.
‘Easter demand was particularly strong, benefitting March due to its early timing. Operational performance was good with peak daily flights broadly in line with summer levels,’ it said. ‘Bookings for summer 2024 continue to build well, with an increase in volume and pricing compared to the same period last year, underpinned by strong demand for easyJet’s primary airport network.’
Segro rose 1.6%, after the property investment firm hailed ‘strong growth’ in rent roll during the first quarter of the year as it noted a stabilisation of industrial and logistics asset values.
It reported total new headline rent signed of £29 million during the first quarter of 2024, up 21% from £24 million a year prior.
The occupancy rate edged down to 94.5% from 95.7% year-on-year due to speculative development completions. Customer retention edged up to 90% from 82%.
In London’s FTSE 250, Hipgnosis Songs Fund jumped 30%. It has agreed to a $1.40 billion cash takeover from music rights acquirer Alchemy Copyrights, which trades as Concord.
Concord will pay $1.16, or 93.2 pence, in cash per Hipgnosis Songs Fund share. The price is a 32% premium to its Wednesday close.
Concord said Higpnosis Songs Fund shareholders will stand to receive up to an extra $25 million in total, if the investment adviser deal with Hipgnosis Song Management is ended.
Hipgnosis Songs Fund is in dispute with its investment adviser, alleging misconduct against Hipgnosis Songs Management and its founder Merck Mercuriadis.
The dispute was sparked by an arrangement, later rejected by Hipgnosis Songs Fund shareholders, to sell part of the fund’s portfolio to a joint venture between Hipgnosis Songs Management and private equity firm Blackstone. This triggered board changes at the fund.
Among London’s small-caps, Petrofac rose 2.7%, after it was awarded a technical services contract with the national oil company of Equatorial Guinea, helping local staff to manage their oil and gas assets.
The energy infrastructure company with core markets in the Middle East and North Africa won a five-year $350 million contract with Compania Nacional de Petroleos de Guinea Ecuatorial, or GEPetrol, to deliver technical services to the operation of Equatorial Guinea’s regional Block B asset.
The contract draws on Petrofac services such as operations, maintenance, asset integrity, integrity management, marine services, well engineering, project delivery and supply chain services.
Petrofac will deliver technical services across onshore support bases, a floating production storage & offloading unit and a platform on behalf of operator GEPetrol.
On AIM in London, Surgical Innovations rose 25%, after the surgical and medical instrument manufacturer reported that revenues increased to £12.01 million from £11.3 million a year earlier, slightly exceeding board expectations.
Pretax loss widened to £728,000 from £57,000.
Surgical Innovations also agreed two new UK distribution contracts. The first is a five-year exclusive contract with Microline Surgical Inc, Boston, US, and the second is a three-year exclusive arrangement with Peters Surgical, based in Paris, France.
A barrel of Brent oil slumped to $87.15 at the London equities close on Thursday from $88.68 late Wednesday.
Gold traded at $2,384.41 an ounce at the London equities close on Thursday, up slightly from $2,383.47 on Wednesday.
In Friday’s UK corporate calendar, Man Group posts a trading statement.
The economic calendar has German producer price inflation and UK retail sales data both out at 0700 SAT.
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