A stronger pound and share price slides for Vodafone and Ocado ensured the FTSE 100 enviously watched on the sidelines as global stocks surged.
A favourable US factory gate inflation reading lifted the mood on Tuesday.
The FTSE 100 index ended 15.73 points lower, 0.2%, at 7,369.44 on Tuesday. The FTSE 250 ended down 166.37 points, or 0.9%, at 19,455.88, and the AIM All-Share ended down 3.09 points, 0.4%, at 848.46.
The Cboe UK 100 ended down 0.4% at 735.82. The Cboe UK 250 closed down 0.9% at 16,777.63, while the Cboe Small Companies closed down 0.6% at 12,877.10.
Stocks on the continent were higher. The CAC 40 index in Paris and DAX 40 in Frankfurt each rose 0.5%.
The pound was quoted at $1.1891 late on Tuesday afternoon in London, up from $1.1714 late Monday. The euro traded at $1.0385, up from $1.0334 late Monday. Against the yen, the dollar was quoted at JP¥139.16, down from JP¥140.45.
Stocks in New York were higher on Tuesday. The Dow Jones Industrial Average was 0.7% higher, the S&P 500 jumped 1.3% and the Nasdaq Composite surged 2.2%.
Equities largely rose, but the dollar weakened after a cooler-than-expected US producer price reading.
The greenback had a decent start to the week, as selling pressure stemming from a cooler-than-expected consumer price inflation reading last week eased.
A similarly cool factory gate inflation put the heat on the dollar once again on Tuesday, however.
'Last week's lower-than-expected core CPI print raised hopes that the Fed's tightening cycle was entering the end phase. Today's PPI report has offered further succor to the notion that the Fed will actually be in a position to cut rates if, as we fear, the US enters recession in 2023,' analysts at ING commented.
Upward pressure on US producer prices eased last month, figures from the Bureau of Labor Statistics showed.
The producer price index for final demand rose by 0.2% in October from September, the same monthly rise as seen in September. In August, PPI had been flat on the month before.
On an annual basis, PPI inflation was 8.0% in October, slowing from 8.4% in September. Annual producer price inflation has slowed each month since June, when it stood at 11.2%. The recent peak was 11.7% in March.
The stronger pound put pressure on the FTSE 100 in London.
A share price slide for Vodafone also did. Chief Executive Nick Read said the telecommunications firm is taking a number of steps to mitigate the 'economic backdrop of higher energy costs and rising inflation'.
Vodafone lowered its full-year outlook for adjusted earnings before interest, tax, depreciation, and amortization and special losses to between €15.0 billion and €15.2 billion. Previously, it had guided between €15.0 billion and €15.5 billion.
Vodafone shares fell 7.7%.
'A share price that is unchanged since 1998 is unlikely to be a good sign and for all of his efforts with disposals, mergers and spin-offs, chief executive Nick Read is struggling to get a tune out of Vodafone,' AJ Bell analyst Russ Mould commented.
'The company still looks like an investment trust of telecoms assets, is not offering much by way of sales, profit or dividend growth and remains saddled with a hefty debt burden as a result of 2019's purchase of Liberty Global's operations in Germany and Eastern Europe.'
Also sliding, Ocado gave back a hefty 7.2%. The stock went into Tuesday's session up roughly 95% since the start of last month. Shares have been supported recently by a partnership with Lotte Shopping, the largest retail affiliate of the South Korean conglomerate Lotte Group.
The deal was announced at the start of November.
On the up, however, Card Factory jumped 15%. It upped annual profit guidance on a better-than-expected second half so far. Focus now turns to the key Christmas trading period, which has begun in decent fashion.
Like-for-like sales are up 6.2% in the year-to-date, driven by 'strong' in-store performances. Card Factory said both its online business and commercial partnerships have performed in line with expectations.
Card Factory now expects pretax profit to multiply to £37.5 million in the year ending January 31, from £11.1 million in 2022.
Earnings before interest, taxes, depreciation, and amortisation is expected to hit £96.0 million, beating current consensus of £88.8 million, the greeting cards, gifts, wrap and gift bags seller said.
Speedy Hire shares fell 7.5% as the Merseyside-based tools hire services firm reported that its profit had fallen in the first half of the year due to inflationary pressures on its cost base.
Nonetheless, Speedy Hire said it remained confident for its full year results.
'Revenue growth is continuing with new contract wins, the effect of actions taken on price and a healthy pipeline of customer activity which gives confidence for further growth in the second half,' said Chief Executive Dan Evans, though he cautioned that the macroeconomic outlook remained uncertain and inflationary pressures were high.
Gold was priced at $1,770.82 an ounce late Tuesday in London, up sharply from $1,758.52 late Monday. Brent oil fetched $93.03 a barrel, down from $94.44.
Wednesday's economic calendar has a UK inflation reading at 0700 GMT, before a house price index at 0930 GMT. Retail sales data from the US is reported at 1330 GMT.
The local corporate calendar has half-year results from property investor British Land, energy company SSE and annual results from Sage Group.
Copyright 2022 Alliance News Limited. All Rights Reserved.
