London midday: FTSE falls further; insurers under the cosh

(Sharecast News) - London stocks had fallen further into the red by midday on Thursday, with sentiment dented by worries about inflation and a global slowdown as investors eyed key earnings across the pond from the likes of JPMorgan and Morgan Stanley. The FTSE 100 was down 0.6% at 7,114.22.

CMC Markets analyst Michael Hewson said: "With bond markets increasingly pricing economic slowdown equity markets are struggling to make sense of what comes next when it comes to valuations, with the first test coming later today with JPMorgan Chase Q2 earnings numbers.

"The second puzzle to navigate is how many more rate hikes are coming down the pipe before we see central banks cutting rates again."

On home shores, market participants were mulling the latest Royal Institution of Chartered Surveyors Residential Market Survey, which showed that house prices continued to grow in June, but at a slower pace than previously seen.

A net balance of 65% of respondents reported an increase in house prices. That remains well above the long-run average of 13%, although it is down on both April's high of 78% and May's 73%.

Surging inflation has seen the Bank of England increase the cost of borrowing five times since December. Yet despite that, and the cost-of-living crisis, house prices have been broadly supported by a lack of supply, despite a softening in demand.

RICS found that new properties being listed for sale remained largely unchanged in June, while new buyer enquiries fell for the third successive month, with -27% of respondents reporting a fall in interest from would-be buyers,

The volume of sales also dipped in June, with -13% reporting a fall in newly agreed sales. A balance of -9% anticipated a fall in transactions in the coming months; 37% expect prices to continue rising over the next year.

Simon Rubinsohn, chief economist at RICS, said: "Pricing across much of the housing market remains resilient for now, with a shortage of stock continuing to be a feature highlighted by many respondents to the survey.

"Although buyer enquiries have predictability slipped a little of late, this needs to be placed in the context of the healthy level of demand in previous months."

In equity markets, Barratt Developments fell after it said annual profits were on track to beat forecasts following buoyant demand for new homes, but warned over rising build costs.

Peers Taylor Wimpey and Berkeley also lost ground, although Redrow bucked the trend after announcing a £100m share buyback.

Playtech tumbled after TTB Partners said it wouldn't be making a bid for the company due to "challenging underlying market conditions".

Ashmore and SSP were also in the red after trading updates, while Ninety One fell as it traded without entitlement to the dividend.

Admiral and Direct Line suffered heavy losses after motor insurer Sabre Insurance said it expects to pay out a smaller dividend for 2022 as it warned over the impact of claims inflation. Sabre shares were down 35%.

On the upside, credit-checking firm Experian rose after it reiterated its annual targets following a strong start to the year.

Market Movers

FTSE 100 (UKX) 7,114.22 -0.59% FTSE 250 (MCX) 18,677.52 -0.18% techMARK (TASX) 4,257.50 -0.65%

FTSE 100 - Risers

Entain (ENT) 1,129.00p 4.30% Centrica (CNA) 87.00p 3.13% Experian (EXPN) 2,645.00p 2.92% International Consolidated Airlines Group SA (CDI) (IAG) 108.92p 2.77% Melrose Industries (MRO) 161.95p 2.56% JD Sports Fashion (JD.) 125.90p 1.90% Whitbread (WTB) 2,580.00p 1.42% Barclays (BARC) 151.04p 1.22% Dechra Pharmaceuticals (DPH) 3,572.00p 1.02% Burberry Group (BRBY) 1,672.50p 0.97%

FTSE 100 - Fallers

Admiral Group (ADM) 2,024.00p -14.27% Rio Tinto (RIO) 4,661.00p -2.73% Anglo American (AAL) 2,616.50p -2.55% AstraZeneca (AZN) 10,784.00p -1.79% Shell (SHEL) 1,966.80p -1.76% Fresnillo (FRES) 672.80p -1.72% SEGRO (SGRO) 1,014.50p -1.65% Intermediate Capital Group (ICP) 1,347.00p -1.39% Antofagasta (ANTO) 1,027.50p -1.34% Glencore (GLEN) 412.95p -1.31%

FTSE 250 - Risers

Mitie Group (MTO) 62.80p 5.90% Redrow (RDW) 520.00p 5.69% ASOS (ASC) 976.50p 4.83% Wizz Air Holdings (WIZZ) 1,862.00p 4.46% Aston Martin Lagonda Global Holdings (AML) 419.00p 4.18% 888 Holdings (DI) (888) 152.00p 4.04% Hipgnosis Songs Fund Limited NPV (SONG) 112.20p 3.70% easyJet (EZJ) 368.50p 3.51% Abrdn Private Equity Opportunities Trust (APEO) 418.00p 3.21% Hays (HAS) 120.90p 3.07%

FTSE 250 - Fallers

Playtech (PTEC) 414.80p -19.61% Direct Line Insurance Group (DLG) 214.50p -9.26% Ninety One (N91) 186.70p -4.45% Ashmore Group (ASHM) 196.40p -4.20% Computacenter (CCC) 2,364.00p -3.43% Polymetal International (POLY) 169.95p -2.91% Mitchells & Butlers (MAB) 166.90p -2.34% Hiscox Limited (DI) (HSX) 897.80p -2.22% NCC Group (NCC) 186.20p -2.21% Tritax Big Box Reit (BBOX) 181.80p -2.21%