London close: FTSE reverses earlier losses after wave of earnings

(Sharecast News) - London stocks were mixed by the close on Thursday, with the top-flight index breaking into positive territory, as investors waded through an avalanche of corporate news and digested the latest eurozone inflation data. The FTSE 100 ended the session up 0.37% at 7,944.04, while the FTSE 250 was 0.1% weaker at 19,851.65.

Sterling was also in the red, last trading down 0.76% on the dollar at $1.1938, and weakening 0.04% against the euro to change hands at €1.1273.

"It's been another testing session for European markets after EU CPI inflation came in above expectations and core prices surged to a new record high of 5.6%," said CMC Markets chief market analyst Michael Hewson.

"Nonetheless while yields have continued to edge higher, markets in Europe have held up quite well, with the FTSE 100 managing to drag itself into positive territory in the afternoon session., although the DAX has lagged.

"We've also seen a plethora of earnings announcements which have by and large been quite positive, but where the guidance has been slightly underwhelming hence today's [earlier] weakness on the FTSE 100."

In economic news, eurozone inflation eased less than expected in February according to preliminary data from Eurostat.

Headline inflation in the bloc ticked down to 8.5% year-over-year in February from 8.6% in January.

That was above consensus expectations for a decline to 8.2%.

Food, alcohol and tobacco inflation rose to 15% from 14.1%, while energy inflation declined to 13.7% from 18.9%.

Meanwhile, the core rate of inflation - which excludes energy, food, alcohol and tobacco - rose to a record 5.6% in February from 5.3% the month before, coming in above expectations for it to be unchanged.

Separate figures from Eurostat showed that headline eurozone unemployment was unchanged at an upwardly-revised 6.7% in January, in line with consensus expectations.

"February's increase in core inflation will reinforce ECB policymakers' conviction that significant rate increases are needed," said Jack Allen-Reynolds, deputy chief eurozone economist at Capital Economics.

"For some time we have been forecasting a 50 basis points hike at the meeting in two weeks' time and another in May, but further hikes at later meetings now look increasingly likely."

Turning stateside, unemployment claims in the US were little changed last week, with the US Department of Labor reporting that initial jobless claims drifted lower by a seasonally-adjusted 2,000 over the week ended 25 February, reaching 190,000.

Economists had been expecting a small rise to 195,000, while the estimate for the prior week was unchanged at 192,000.

A four-week moving average of initial claims, designed to smooth out fluctuations in the data from one week to the next, increased by 1,750 to 193,000.

Secondary claims - those not being filed for the first time - dipped by 5,000 to 1.665 million for the week ended 18 February.

Commenting on the latest figures, Nancy Vanden Houten, lead US economist at Oxford Economics, pointed out that continuing claims, after trending higher through the autumn, had now stabilised around their pre-pandemic levels.

Initial unemployment claims meanwhile showed that the labour market was "too tight to help the Fed in its effort to lower inflation, leaving the central bank on track to raise rates at the following three meetings," the economist added.

Looking ahead, she said she believed that the rise in first-time claims might be muted in comparison to previous recessions, as companies would be reluctant to let go of staff.

On London's equity markets, insurer Beazley slumped 5.13% after it reported a drop in full-year profit as it took a hit from investment losses.

GSK spinoff Haleon lost 3.98% after it said full-year adjusted operating profit rose 13.8% and that it expected organic revenue growth of 4% to 6% for 2023, and for the adjusted operating margin to be "broadly flat".

Flutter Entertainment fell 1.19% even after it reported strengthened revenues, boosted by acquisitions and a strong performance in the US.

ITV was off 3.44% after the broadcaster reported lower annual profits due to tougher economic conditions and the investment made in its ITVX streaming service.

Taylor Wimpey nudged 1.18% lower after it warned that completions were set to fall this year, making it the latest housebuilder to see higher mortgage costs and the cost-of-living crisis knock buyer confidence after a profit warning from Persimmon on Wednesday.

Spire Healthcare Group slid 3.77% despite saying it swung to a profit in 2022, while Schroders lost 3.74% after it said annual pre-tax profit slid 23% to £586.9m.

HSBC was down 3.33%, Hargreaves Lansdown lost 1.72% and Berkeley Group was off 2.02% as they traded without entitlement to the dividend.

On the upside, CRH jumped 8.03% after the building materials group posted a jump in full-year earnings and sales, and said it was planning to recommend a transition to a US primary listing this year.

Melrose Industries gained 1.2% after it said 2022 profits came in higher than expected and forecast a significantly stronger performance from its aerospace unit this year.

Molten metal flow engineer Vesuvius added 2.65% after record full-year results, despite "tough" markets and inflationary pressures.

In the year ended 31 December, pre-tax profit rose 62% to £207m, with revenues up 25% at £2bn.

Trading profit was 60% higher at £227m, and the company delivered a return on sales of 11.1%, up from 8.7% a year earlier.

Elsewhere, National Express Group surged 10.81%, and Coats Group advanced 8.07%, after they also reported results.

Reporting by Josh White for Sharecast.com. Additional reporting by Michele Maatouk, Frank Prenesti and Alexander Bueso.

Market Movers

FTSE 100 (UKX) 7,944.04 0.37% FTSE 250 (MCX) 19,851.65 -0.10% techMARK (TASX) 4,637.41 -0.04%

FTSE 100 - Risers

CRH (CDI) (CRH) 4,276.50p 8.03% Croda International (CRDA) 6,716.00p 2.22% BP (BP.) 561.20p 1.98% Coca-Cola HBC AG (CDI) (CCH) 2,178.00p 1.87% BAE Systems (BA.) 919.60p 1.66% Diageo (DGE) 3,578.50p 1.65% Shell (SHEL) 2,604.50p 1.58% Unilever (ULVR) 4,188.50p 1.23% Spirax-Sarco Engineering (SPX) 11,955.00p 1.23% Entain (ENT) 1,379.50p 1.21%

FTSE 100 - Fallers

Beazley (BEZ) 647.50p -5.13% Haleon (HLN) 313.60p -3.98% Schroders (SDR) 481.50p -3.74% Persimmon (PSN) 1,234.00p -3.41% HSBC Holdings (HSBA) 619.00p -3.33% Barratt Developments (BDEV) 435.40p -3.03% Berkeley Group Holdings (The) (BKG) 4,027.00p -2.02% Prudential (PRU) 1,269.50p -1.89% Hargreaves Lansdown (HL.) 822.00p -1.72% International Consolidated Airlines Group SA (CDI) (IAG) 151.24p -1.60%

FTSE 250 - Risers

National Express Group (NEX) 137.40p 10.81% Coats Group (COA) 79.00p 8.07% Aston Martin Lagonda Global Holdings (AML) 218.50p 5.25% Wizz Air Holdings (WIZZ) 2,731.00p 4.28% Moonpig Group (MOON) 116.60p 3.64% 4Imprint Group (FOUR) 4,675.00p 3.54% Shaftesbury (SHB) 416.20p 3.48% Trainline (TRN) 265.50p 3.11% Pagegroup (PAGE) 471.20p 2.88% Man Group (EMG) 286.80p 2.80%

FTSE 250 - Fallers

Hunting (HTG) 305.50p -8.53% Just Group (JUST) 84.20p -5.61% Softcat (SCT) 1,175.00p -4.00% Investec (INVP) 511.20p -3.91% Chemring Group (CHG) 288.50p -3.83% Spire Healthcare Group (SPI) 230.00p -3.77% ITV (ITV) 85.44p -3.44% Rathbones Group (RAT) 2,045.00p -3.08% Ninety One (N91) 203.00p -3.06% Ashmore Group (ASHM) 260.00p -2.99%