London midday: Stocks maintain gains amid data slew; Beazley surges

(Sharecast News) - London stocks were still in the black by midday on Friday as investors mulled the latest retail sales, consumer confidence and business activity data. The FTSE 100 was up 0.4% at 7,296.68.

A survey released earlier showed that manufacturing output fell in July for the first time since May 2020. The S&P Global/CIPS manufacturing output index declined to 49.7 from 50.3 in June, coming in below the 50.0 mark that separates contraction from expansion.

Manufacturers cited a lack of new work to replace completed orders amid subdued client confidence and weaker global economic conditions.

The manufacturing purchasing mangers' index dipped to 52.2 in July from 52.8 the month before, hitting a 25-month low.

Meanwhile, the services PMI business activity index fell to 53.3 from 54.3 and the composite output index - which measures activity in both services and manufacturing - declined to 52.8 from 53.7.

Chris Williamson, chief business economist at S&P Global Market Intelligence, said: "UK economic growth slowed to a crawl in July, registering the slowest expansion since the lockdowns of early-2021. Although not yet in decline, with pent-up demand for vehicles and consumer-oriented services such as travel and tourism helping to sustain growth in July, the PMI is now at a level consistent with just 0.2% GDP growth.

"Forward-looking indicators suggest worse is to come. Manufacturing order books are now deteriorating for the first time in one and a half years as inflows of new work are insufficient to keep workforces busy, which is usually a precursor to output and jobs being cut in coming months. Raw material buying has already slumped and hiring has slowed as companies reassess their requirements for the coming months in the face of worsening demand conditions."

Separate figures from the Office for National Statistics showed that retail sales fell in June amid the cost-of-living crisis.

Sales dipped 0.1% on the month following a revised 0.8% fall in May and versus expectations for a 0.3% decline. Retail sales volumes were 2.2% above their pre-Covid February 2020 levels, but down over the past year.

The data that the Queen's Platinum Jubilee failed to give shops the boost many had expected. While food sales volumes rose by 3.1% thanks to the celebrations, non-food store sales fell 0.7% over the month. Clothing store sales were down 4.7%, while household goods sales declined 3.7%. Meanwhile, automotive fuel sales volumes fell 4.3% amid record high prices.

Helen Dickinson, chief executive of the British Retail Consortium, said: "The cost-of-living crunch caused by record inflation continue to damage consumer confidence and stifle household spending. Discretionary spending and particularly bigger purchases were put off as consumers become increasingly concerned about the future. As a result, furniture sales and white goods were particularly hard hit, while food sales held up a little better.

"Retailers are squeezed between higher costs and weaker demand, resulting in the most challenging trading period since the start of the pandemic."

The latest survey from GfK was also in focus, as it revealed that consumer confidence remained at a record low in July amid surging prices and rising interest rates. The consumer confidence barometer's overall index was flat on the month at -48.

Joe Staton, client strategy director at GfK, said: "Consumer confidence remains severely depressed this month as the impact of soaring food and fuel prices and rising interest rates continues to darken the financial mood of the nation.

"Despite a two-point uptick in our hopes for our personal financial situation for the next 12 months, which might reflect optimism over imminent change at the top of the UK government, the overall index languishes at a historic low amid acute concerns for the general economic situation."

In equity markets, Beazley surged after the insurer posted a drop in interim pre-tax profit but reported its best combined ratio since 2015 and lifted its 2022 combined ratio guidance to high 80s. Lancashire Holdings also rose sharply.

Fund management services provider JTC gained as it hailed record new business growth in its interim results.

Quilter was knocked lower by a downgrade to 'neutral' from 'overweight' at JPMorgan Cazenove.

Home repairs and improvements business HomeServe was more or less flat after it said trading has been in line with expectations as shareholders prepared to approve a £4bn takeover by Canada's Brookfield Asset Management.

JD Sports lost ground even as it said that like-for-like sales were up 5% year-to-date and reiterated guidance for full-year headline pre-tax profits in line with its record performance in the year ended 29 January.

Market Movers

FTSE 100 (UKX) 7,296.68 0.36% FTSE 250 (MCX) 19,898.78 0.96% techMARK (TASX) 4,419.16 0.65%

FTSE 100 - Risers

Ocado Group (OCDO) 811.20p 7.70% Flutter Entertainment (CDI) (FLTR) 8,314.00p 3.61% Scottish Mortgage Inv Trust (SMT) 875.60p 2.91% Dechra Pharmaceuticals (DPH) 3,722.00p 2.87% Entain (ENT) 1,179.50p 2.61% Unite Group (UTG) 1,199.00p 2.30% Aveva Group (AVV) 2,413.00p 2.29% Halma (HLMA) 2,297.00p 2.23% British Land Company (BLND) 486.10p 2.08% SEGRO (SGRO) 1,073.00p 2.00%

FTSE 100 - Fallers

Mondi (MNDI) 1,450.00p -3.17% Smith (DS) (SMDS) 279.60p -1.79% Standard Chartered (STAN) 578.00p -1.57% Avast (AVST) 504.60p -1.41% Smurfit Kappa Group (CDI) (SKG) 2,817.00p -1.37% HSBC Holdings (HSBA) 516.50p -1.32% Smiths Group (SMIN) 1,497.00p -1.25% BT Group (BT.A) 179.05p -1.10% Intermediate Capital Group (ICP) 1,456.00p -1.09% Imperial Brands (IMB) 1,855.00p -0.93%

FTSE 250 - Risers

Beazley (BEZ) 515.00p 7.97% Lancashire Holdings Limited (LRE) 430.00p 7.07% 4Imprint Group (FOUR) 3,130.00p 5.74% JTC (JTC) 747.00p 5.21% 888 Holdings (DI) (888) 158.70p 4.13% Diploma (DPLM) 2,798.00p 3.71% Baltic Classifieds Group (BCG) 153.40p 3.65% Blackrock Throgmorton Trust (THRG) 637.00p 3.58% ASOS (ASC) 1,162.00p 3.47% Allianz Technology Trust (ATT) 243.00p 3.40%

FTSE 250 - Fallers

Aston Martin Lagonda Global Holdings (AML) 493.00p -6.91% Currys (CURY) 70.65p -2.55% Syncona Limited NPV (SYNC) 204.00p -1.69% Vietnam Enterprise Investments (DI) (VEIL) 657.00p -1.20% Jupiter Fund Management (JUP) 139.00p -1.14% Serco Group (SRP) 183.00p -1.13% FirstGroup (FGP) 131.60p -1.05% ITV (ITV) 70.24p -1.01% Hochschild Mining (HOC) 74.90p -0.99% NB Private Equity Partners Ltd. (NBPE) 1,590.00p -0.93%