London midday: FTSE slides as investors eye US inflation

(Sharecast News) - London stocks were firmly in the red by midday on Friday amid worries about rising inflation, as investors eyed the latest US consumer price data. The FTSE 100 was down 1.2% at 7,383.45, extending earlier losses.

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: "Inflation is what is scaring the horses on financial markets and equities in Europe are galloping lower after another pretty wild ride for US equities.

"Eyes are locked firmly on the release of the US Consumer Price Index due out later, and it's the anticipation of the bleak scenario which this data is set to reveal which is causing this fresh jump of anxiety. Prices are expected to show a year-on-year increase of 8.3%, the highest in almost 40 years and there are expectations the Federal Reserve may have to pull more tightly on the reins to slow it down. Signs that prices had spiralled even higher last month, are likely to set off a fresh round of selling, but a lower than expected reading could prompt a wave of buying which would top off a volatile week for stocks.

"The European Central Bank's decision to raise interest rates in July for the first time in 11 years yesterday was a fresh jolt for financial markets and is another sign that the cheap money journey is hurtling abruptly to an end."

On home turf, banks were in focus after the Bank of England said the UK's top lenders were no longer "too big to fail", meaning that none would require a bailout in the event of a crisis. However, it did find shortcomings at Lloyds, HSBC and Standard Chartered over resolution plans. All three were trading lower.

Also included in the review were Barclays, NatWest, Santander UK, Virgin Money and Nationwide.

The BoE said: "The Bank's assessment of resolvability shows that even if a major UK bank were to require resolution, customers would be able to keep accessing their accounts and business services as normal."

Elsewhere, GlaxoSmithKline edged up after saying that its vaccine for respiratory syncytial virus had shown "statistically significant and clinically meaningful efficacy in adults aged 60 years and above in a phase 3 trial. The company said the primary endpoint of the trial was "exceeded with no unexpected safety concerns observed" and would now start talks with regulators to start immediately with anticipated regulatory submissions in the second half of the year.

Outside the FTSE 350, ProCook shares tanked after the kitchenware retailer warned on profits as consumers tighten their belts. It now sees adjusted pre-tax profit of between £4m and £6m for FY23, down from an expected £10m in FY22.

Market Movers

FTSE 100 (UKX) 7,383.45 -1.24% FTSE 250 (MCX) 19,870.41 -1.01% techMARK (TASX) 4,318.60 -0.61%

FTSE 100 - Risers

Aveva Group (AVV) 2,444.00p 2.78% Sainsbury (J) (SBRY) 211.40p 0.96% Ocado Group (OCDO) 923.20p 0.85% Airtel Africa (AAF) 146.90p 0.69% Entain (ENT) 1,459.00p 0.62% Pearson (PSON) 739.40p 0.52% Ashtead Group (AHT) 4,058.00p 0.22% Persimmon (PSN) 2,197.00p 0.18% Intermediate Capital Group (ICP) 1,479.50p 0.14% Meggitt (MGGT) 773.20p 0.13%

FTSE 100 - Fallers

Melrose Industries (MRO) 156.55p -4.72% CRH (CDI) (CRH) 3,090.00p -3.10% JD Sports Fashion (JD.) 117.75p -3.09% Associated British Foods (ABF) 1,604.00p -2.91% Anglo American (AAL) 3,792.50p -2.87% Rolls-Royce Holdings (RR.) 89.20p -2.72% Coca-Cola HBC AG (CDI) (CCH) 1,731.00p -2.48% WPP (WPP) 850.40p -2.45% Scottish Mortgage Inv Trust (SMT) 780.00p -2.35% Aviva (AV.) 412.90p -2.34%

FTSE 250 - Risers

Apax Global Alpha Limited (APAX) 195.80p 9.39% CMC Markets (CMCX) 254.50p 6.49% ICG Enterprise Trust (ICGT) 1,074.00p 5.92% HarbourVest Global Private Equity Limited A Shs (HVPE) 2,235.00p 2.76% Hochschild Mining (HOC) 111.80p 2.57% Abrdn Private Equity Opportunities Trust (APEO) 484.00p 2.54% Fidelity China Special Situations (FCSS) 276.50p 2.41% NB Private Equity Partners Ltd. (NBPE) 1,405.00p 1.81% Pantheon International (PIN) 268.50p 1.70% IG Group Holdings (IGG) 679.50p 1.42%

FTSE 250 - Fallers

Trustpilot Group (TRST) 87.00p -7.94% Wizz Air Holdings (WIZZ) 2,200.00p -5.34% Ferrexpo (FXPO) 172.70p -4.00% Liontrust Asset Management (LIO) 1,002.00p -3.84% Watches of Switzerland Group (WOSG) 854.50p -3.61% Synthomer (SYNT) 285.20p -3.32% Darktrace (DARK) 351.80p -3.30% Wood Group (John) (WG.) 222.20p -3.22% Ibstock (IBST) 185.50p -3.18% Oxford Biomedica (OXB) 493.00p -3.14%