London midday: FTSE up as GDP data reinforces rate cut expectations

(Sharecast News) - London stocks were still in the black by midday on Friday as the latest UK GDP data cemented expectations of a rate cut from the Bank of England next week, and helped along by a strong showing from gold miners. The FTSE 100 was up 0.2% at 9,718.20.

Figures released earlier by the Office for National Statistics showed the economy unexpectedly contracted in October amid uncertainty ahead of the Budget.

The economy shrank 0.1% following a 0.1% decline in September and no growth in August. Economists had been expecting growth of 0.1%.

Services saw a 0.3% decline, while construction fell by 0.6%, but production grew by 1.1% in October.

ONS director of economic statistics Liz McKeown said: "The economy contracted slightly in the latest three months, as production fell again and services growth stalled.

"Within production, there was continued weakness in car manufacturing, with the industry only making a slight recovery in October from the substantial fall in output seen in the previous month.

"Overall services showed no growth in the latest three months, continuing the recent trend of slowing in this sector. There were falls in wholesale and scientific research, offset by growth in rental and leasing and retail."

Richard Hunter, head of markets at Interactive Investor, said: "The 0.1% increase which had been expected simply did not materialise and was not helped by a high level of uncertainty around the Budget and its stultifying actions.

"With the economy heading closer to a technical recession, the Bank of England may be forced to take action and ease interest rates more aggressively in an effort to inject some enthusiasm into the ailing economy at its meeting next week."

In equity markets, precious metals miner Fresnillo and gold miners Hochschild and Endeavour all shone as gold prices rose.

Independent oil and gas company Harbour Energy rallied after agreeing to buy all the subsidiaries of Waldorf Energy Partners and Walford Production Ltd in a $170m deal.

Standard Chartered gained after an upgrade to 'buy' at Goldman Sachs, while InterContinental Hotels was boosted by an upgrade to 'buy' at Jefferies.

Premier Inn owner Whitbread was knocked lower by a downgrade to 'hold' at Jefferies, while Playtech fell after a downgrade to 'underweight' at Morgan Stanley.

WH Smith lost ground after delaying the publication of its annual results to 19 December to give auditors more time to finish their work in the wake of an accounting error that wiped almost £600m from the company's stock market value last month and led to the departure of chief executive Carl Cowling.

Electricals retailer Currys slumped ahead of interim results next Thursday.

Card Factory tumbled as it warned on profits, pointing to weak consumer confidence and soft high street footfall.

The company, which sells greetings cards and gifts, now expects to deliver full-year adjusted pre-tax profit of between £55m and £60m. It had previously guided to mid-to-high single-digit percentage growth, from £66m.

Market Movers

FTSE 100 (UKX) 9,718.20 0.15% FTSE 250 (MCX) 21,962.81 0.51% techMARK (TASX) 5,577.55 0.28%

FTSE 100 - Risers

Fresnillo (FRES) 2,972.00p 3.99% Ashtead Group (AHT) 5,140.00p 2.59% Standard Chartered (STAN) 1,756.50p 2.30% Flutter Entertainment (DI) (FLTR) 16,610.00p 2.25% BT Group (BT.A) 180.60p 2.18% Burberry Group (BRBY) 1,242.50p 2.01% Antofagasta (ANTO) 3,021.00p 1.96% Pershing Square Holdings Ltd NPV (PSH) 5,080.00p 1.93% InterContinental Hotels Group (IHG) 10,225.00p 1.74% Beazley (BEZ) 815.50p 1.62%

FTSE 100 - Fallers

Metlen Energy & Metals (MTLN) 41.90p -3.23% Whitbread (WTB) 2,363.00p -1.75% Tesco (TSCO) 440.50p -1.23% DCC (CDI) (DCC) 5,085.00p -1.17% AstraZeneca (AZN) 13,442.00p -1.13% British American Tobacco (BATS) 4,335.00p -1.12% Rentokil Initial (RTO) 427.70p -1.11% Next (NXT) 13,430.00p -1.07% Convatec Group (CTEC) 226.80p -1.05% Hikma Pharmaceuticals (HIK) 1,512.00p -1.05%

FTSE 250 - Risers

Hochschild Mining (HOC) 476.40p 7.25% Harbour Energy (HBR) 208.60p 4.72% Wizz Air Holdings (WIZZ) 1,150.00p 3.42% Endeavour Mining (EDV) 3,652.00p 3.05% W.A.G Payment Solutions (EWG) 100.50p 2.76% Chemring Group (CHG) 473.00p 2.60% Senior (SNR) 188.40p 2.17% Ceres Power Holdings (CWR) 281.40p 2.03% RS Group (RS1) 655.50p 1.94% Morgan Advanced Materials (MGAM) 210.50p 1.94%

FTSE 250 - Fallers

Diversified Energy Company (DI) (DEC) 1,095.00p -3.52% Oxford Nanopore Technologies (ONT) 126.90p -2.91% Vietnam Enterprise Investments (DI) (VEIL) 735.00p -2.39% Currys (CURY) 127.00p -2.31% Rank Group (RNK) 108.20p -1.99% WH Smith (SMWH) 656.00p -1.72% Pennon Group (PNN) 512.50p -1.54% Helios Towers (HTWS) 160.40p -1.35% Frasers Group (FRAS) 631.00p -1.33% Tate & Lyle (TATE) 365.00p -1.19%