London close: Stocks mixed ahead of Fed, BoE rate decisions

(Sharecast News) - London stocks were in a mixed state at the close on Wednesday, as investors sifted through a deluge of corporate news and eyed the latest policy announcements from the US Federal Reserve and the Bank of England. The FTSE 100 ended the session down -0.58% at 7,144.14, while the FTSE 250 was up 0.12% at 18,217.75.

Sterling was below the waterline, and was last down 0.22% on the dollar at $1.1459, while it weakened 0.08% against the euro to trade at €1.1619.

The Fed rate announcement is due later in the evening, while Threadneedle Street will announce its decision on Thursday.

Both central banks were expected to raise rates by 75 basis points.

"Given the uncertainty prevailing on any afternoon ahead of a Fed decision, it is not surprising to see the cautious attitude of the past two days continue on Wednesday afternoon," said IG chief market analyst Chris Beauchamp.

"Without much in the way of big earnings to drive it, the FTSE 100 has retreated from its six-week high near 7,200, although losses remain contained for now.

"More than usual, it feels like everyone will reassess their positions once the Fed decision is known, but hints today from the Fed's 'Whisperer' suggest that, once again, the world's most important central bank will take a hawkish line."

In economic news, shop price inflation reached a fresh record high last month as the price of food continued to spike.

According to the latest BRC-Nielsen IQ shop price index, retail inflation reached 6.6% in October from 5.7% a month earlier.

That was well above the three-month average of 5.5%, and the highest since the index began in 2005.

Within that, food inflation surged to 11.6% from 10.6% in September - the highest rate on record.

Fresh food saw the biggest price hikes, with inflation at 13.3% against September's 12.1%, while ambient food inflation rose to 9.4% from 8.6%.

Non-food inflation also hit a series high, however, rising to 4.1% from 3.3%.

"It has been a difficult month for consumers, who not only faced an increase in their energy bills, but also a more expensive shopping basket," said Helen Dickinson, chief executive of the British Retail Consortium.

"Prices were pushed up because of the significant input cost pressures faced by retailers due to rising commodity and energy prices and a tight labour market."

Dickinson added that while "some" supply chain costs were now beginning to fall, it was being offset by the cost of energy.

On the continent, manufacturing within the eurozone fell at the start of the fourth quarter, with the final reading for S&P Global's factory sector purchasing managers' index revealing a slide to 46.4 in September - the lowest reading since May 2020 - from 48.4 for August.

It was also worse than the consensus forecast, and preliminary reading, of 46.6.

"In October, new orders fell at a rate we've rarely seen during 25 years of data collection," said Joe Hayes, senior economist at S&P Global Market Intelligence.

"Only during the worst months of the pandemic and in the height of the global financial crisis between 2008 and 2009 have decreases been stronger."

Germany's labour market remained resilient last month, meanwhile, with unemployment claims rising by less than expected.

According to the Federal Labour Agency, the rate of unemployment was steady versus the month before at 5.5%, as expected.

Jobless claims, on the other hand undershot forecasts, increasing by 8,000, compared to consensus expectations for a surge of 15,000.

Across the pond, US companies added 239,000 jobs in October according to the latest data from ADP, with the leisure and hospitality sector doing most of the heavy lifting.

October's reading beat estimates for a print of 195,000 and September's downwardly-revised 192,000, and came alongside a 7.7% year-on-year increase in overall wages.

The leisure and hospitality sector added 210,000 positions, with wage growth rising 11.2%, with services-related industries adding 247,000 and goods-producing sectors losing 8,000 jobs.

On London's equity markets, online grocer and warehouse tech specialist Ocado Group was off 0.64% after a downgrade to 'underweight' at JPMorgan, while British American Tobacco slumped 5.51% following a downgrade to 'neutral' at Goldman Sachs.

Online fashion retailer Asos was 2.59% lower after Liberum downgraded rival Boohoo to 'sell', while packaging firm Smurfit Kappa Group was in the red by 2.28% after a trading statement.

Aston Martin Lagonda tumbled 15.25% after the luxury car maker downgraded its delivery expectations amid supply chain issues, and posted a widening of its losses.

In an update for the nine months through September, the company said it now expected total wholesales to be more in line with current consensus expectations at between 6,200 and 6,600, down from previous guidance for more than 6,600.

Hungary-based budget airline Wizz Air descended 0.09% despite producing a better-than-expected second quarter, which helped interim profits to soar by a third.

GSK reversed earlier gains to slip 0.03%, even after the pharmaceuticals giant lifted full-year guidance after beating third-quarter expectations, with an 18% rise in revenues driven by its Shingrix shingles vaccine.

On the upside, Next rallied 1.59% after the retailer maintained its full-year guidance and posted a 0.4% rise in third-quarter full-price sales, slightly ahead of the company's expectations.

Hiscox jumped 5.92% after the specialist insurer said gross written premiums rose 6.3% in the nine months to 30 September.

Shares in tech investor Molten Ventures rose 4.67% as the market welcomed its portfolio revaluation.

The company said its underlying gross portfolio fell 17% in the quarter through September due to tough economic conditions and rising interest rates.

Molten, formerly known as Draper Esprit, said its full-year gross portfolio value was expected to be at least £1.45bn, compared with £1.35bn at the end of September.

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

Market Movers

FTSE 100 (UKX) 7,144.14 -0.58% FTSE 250 (MCX) 18,217.75 0.12% techMARK (TASX) 4,278.59 0.01%

FTSE 100 - Risers

Rolls-Royce Holdings (RR.) 83.06p 1.91% Airtel Africa (AAF) 118.10p 1.81% B&M European Value Retail S.A. (DI) (BME) 343.90p 1.75% AstraZeneca (AZN) 10,520.00p 1.68% Next (NXT) 5,042.00p 1.59% Ashtead Group (AHT) 4,720.00p 1.44% Coca-Cola HBC AG (CDI) (CCH) 1,915.00p 1.30% Severn Trent (SVT) 2,533.00p 1.28% Dechra Pharmaceuticals (DPH) 2,668.00p 1.14% Centrica (CNA) 78.74p 1.08%

FTSE 100 - Fallers

British American Tobacco (BATS) 3,274.00p -5.51% Antofagasta (ANTO) 1,176.00p -4.47% Croda International (CRDA) 6,450.00p -3.67% Anglo American (AAL) 2,670.50p -3.47% Melrose Industries (MRO) 116.65p -2.67% Rio Tinto (RIO) 4,610.50p -2.63% Smurfit Kappa Group (CDI) (SKG) 2,833.00p -2.28% Imperial Brands (IMB) 2,073.00p -2.22% Informa (INF) 554.40p -2.01% Smith (DS) (SMDS) 286.40p -1.88%

FTSE 250 - Risers

Hiscox Limited (DI) (HSX) 951.60p 5.92% Molten Ventures (GROW) 363.20p 4.67% IP Group (IPO) 65.60p 4.54% Tritax Eurobox (GBP) (EBOX) 63.00p 4.13% IntegraFin Holding (IHP) 267.00p 3.89% WH Smith (SMWH) 1,252.00p 3.81% 888 Holdings (DI) (888) 98.50p 3.76% Urban Logistics Reit (SHED) 140.50p 3.69% 4Imprint Group (FOUR) 3,660.00p 3.68% TBC Bank Group (TBCG) 2,060.00p 3.41%

FTSE 250 - Fallers

Aston Martin Lagonda Global Holdings (AML) 89.58p -15.25% TI Fluid Systems (TIFS) 132.80p -5.28% Pets at Home Group (PETS) 279.60p -4.77% Essentra (ESNT) 212.50p -4.28% Hochschild Mining (HOC) 52.70p -4.27% Morgan Sindall Group (MGNS) 1,514.00p -4.06% Synthomer (SYNT) 116.70p -3.55% easyJet (EZJ) 342.90p -3.14% NCC Group (NCC) 198.20p -3.08% LondonMetric Property (LMP) 185.20p -2.94%