London midday: FTSE turns lower ahead of US inflation reading

(Sharecast News) - London stocks had fallen by midday on Wednesday as investors mulled further strikes by the US and Iran and eyed a key US inflation reading. The FTSE 100 was down 0.5% at 10,179.37, while Brent crude was 0.3% lower at $91.22 a barrel and West Texas Intermediate was off 0.1% at $88.11.

Summing up the latest events in the Middle East, Danske Bank said: "Iran's Revolutionary Guards struck a US base in Jordan and 21 other Gulf targets in retaliation for US attacks near the Strait of Hormuz, which were themselves triggered by the alleged downing of a US helicopter."

Away from the conflict, investors will turn their attention to the US consumer price index for May, which is due at 1330 BST.

Susannah Streeter, chief investment strategist at Wealth Club, said that while the latest skirmishes between the US and Iran, including the downing of an American Apache helicopter, are proving unsettling, US inflation data will be the key market driver.

"The CPI numbers are set to show another painful rise in costs for consumers, who are already grappling with sharp increases in the costs of everyday goods," she said. "The expectation is that the headline rate will rise to 4.2% year-on-year with a 0.5% jump in May. The big concern is that elevated wholesale energy costs are spreading and settling into the broader economy.

"The latest attacks in the Middle East indicate that the conflict is entrenched and increasingly hard to solve."

In equity markets, WH Smith tumbled as it cut profit guidance for the second time this year as war in the Middle East curtailed travel and weighed on consumer demand. The retailer now expects full-year headline profits before tax and non-underlying items to come in between £75m and £90m, down from previous guidance for between £90m and £105m.

The chain, which has shops in airports, rail stations and hospitals, also announced plans for a capital raise representing 20% of its share capital.

Flexible office space provider Workspace was in the red as it posted a softer set of full‑year numbers, with earnings hit by lower rental income and a further drop in property valuations.

Pennon shares fell even as the South West Water owner said it swung to a full-year profit, with water revenue up 24.6%, mainly driven by the benefit of increased regulatory allowances and higher consumption.

Software-related stocks were under pressure again, with Relx, Experian, LSEG, Sage and Pearson all lower.

On the upside, DCC rallied following a report that US private equity firm KKR and Energy Capital Partners are in detailed talks about an improved takeover offer for the company worth well over £5bn, after it rejected a previous offer at 5,800p per share.

Market Movers

FTSE 100 (UKX) 10,179.37 -0.47% FTSE 250 (MCX) 22,799.35 -0.17% techMARK (TASX) 5,878.41 -0.14%

FTSE 100 - Risers

Metlen Energy & Metals (MTLN) 41.52p 2.81% Smurfit Westrock (DI) (SWR) 3,070.00p 2.54% DCC (CDI) (DCC) 6,130.00p 2.25% Associated British Foods (ABF) 1,915.50p 1.51% InterContinental Hotels Group (IHG) 163.05p 1.50% British Land Company (BLND) 409.20p 1.39% Tesco (TSCO) 461.60p 1.38% Land Securities Group (LAND) 639.00p 1.35% Admiral Group (ADM) 3,380.00p 1.32% Flutter Entertainment (DI) (FLTR) 8,376.00p 1.04%

FTSE 100 - Fallers

Relx plc (REL) 2,513.00p -3.73% Experian (EXPN) 2,555.00p -2.63% London Stock Exchange Group (LSEG) 8,924.00p -2.48% HSBC Holdings (HSBA) 1,283.40p -2.23% The Sage Group (SGE) 834.40p -2.04% Mondi (MNDI) 719.80p -1.93% Standard Chartered (STAN) 1,780.00p -1.88% Pearson (PSON) 1,134.50p -1.77% Glencore (GLEN) 559.50p -1.49% Airtel Africa (AAF) 342.80p -1.32%

FTSE 250 - Risers

Barr (A.G.) (BAG) 640.00p 3.38% Energean (ENOG) 739.50p 3.13% Grainger (GRI) 163.30p 2.63% Oxford Instruments (OXIG) 2,872.00p 2.43% Keller Group (KLR) 2,514.00p 2.03% Watches of Switzerland Group (WOSG) 706.50p 1.80% Hammerson (HMSO) 335.00p 1.76% Vietnam Enterprise Investments (DI) (VEIL) 764.00p 1.73% Elementis (ELM) 152.20p 1.60% Sirius Real Estate Ltd. (SRE) 97.60p 1.56%

FTSE 250 - Fallers

WH Smith (SMWH) 415.80p -15.48% Raspberry PI Holdings (RPI) 824.25p -13.08% Ceres Power Holdings (CWR) 579.00p -5.09% Aston Martin Lagonda Global Holdings (AML) 40.54p -4.43% Workspace Group (WKP) 320.00p -3.96% Pennon Group (PNN) 492.80p -3.17% Vistry Group (VTY) 242.20p -2.81% Pacific Horizon Inv Trust (PHI) 1,062.00p -2.75% CMC Markets (CMCX) 445.50p -2.52% Polar Capital Technology Trust (PCT) 647.00p -2.49%