London midday: Stocks pare gains as investors eye US inflation, Fed

(Sharecast News) - London stocks had pared earlier gains by midday on Monday, as investors braced for a week of key rate announcements and the latest US inflation reading. The FTSE 100 was flat at 7,561.44.

The Federal Reserve, European Central Bank and Bank of Japan are due to make rate announcements this week.

Russ Mould, investment director at AJ Bell, said: "The Fed is widely expected to keep its finger on the pause button when it announces its decision on rates on Wednesday. The US is showing some signs of slipping into a recession and inflation has eased considerably, even if it still stands a long way above the Fed's 2% target.

"A last-minute shift in the plan cannot be ruled out given the Fed is taking a data-driven approach and inflation numbers from the US are out tomorrow. A higher-than-expected number could set the cat among the pigeons.

"The calculus is different for the Bank of England, given the UK's more persistent inflation alongside warnings from a Bank of England official of further rate hikes, which felt like a parent telling a sickly child they need to take their bitter medicine. Unwelcome but not unexpected. Its meeting next Thursday is expected to see another hike, barring anything dramatic."

On home shores, both the Confederation of British Industry and KPMG said the UK looked set to avoid recession.

In its latest forecast, the CBI said the UK economy will be boosted by an improving global outlook and falling wholesale energy prices.

KPMG also predicted the UK will avoid recession, but said growth will be weak with risks still heavily skewered to the downside.

In equity markets, online supermarket Ocado surged to the top of the FTSE 100 after an upgrade to 'neutral' at BNP Paribas Exane, which said it sees a lack of further negatives.

Croda was also on the rise, having tumbled at the end of last week on the back of a profit warning.

Online electric retailer AO World rallied after Mike Ashley's Frasers Group took a 18.9% stake in the company. The owner of Sports Direct, House of Fraser and other retail clothing chains said it bought 109.4m shares at 68p each.

Elsewhere, Glencore was in focus after it made an offer to buy Teck Resources' steelmaking coal business as a standalone unit. The Swiss mining and trading giant said it had made the alternative proposal "as it is expected to allow for a value accretive demerger of the combined coal and carbon steel materials business".

On the downside, miners fell in tandem with copper prices, with Anglo American, Antofagasta and Rio all down.

Segro slumped after a downgrade to 'neutral' at Goldman Sachs, while Great Portland Estates was knocked lower by a downgrade to 'sell' by the same outfit.

Market Movers

FTSE 100 (UKX) 7,561.44 -0.01% FTSE 250 (MCX) 19,172.60 0.42% techMARK (TASX) 4,564.38 0.23%

FTSE 100 - Risers

Ocado Group (OCDO) 426.80p 10.40% Croda International (CRDA) 5,430.00p 2.96% Experian (EXPN) 2,930.00p 2.16% Abrdn (ABDN) 218.90p 2.15% Admiral Group (ADM) 2,334.00p 1.74% Intertek Group (ITRK) 4,349.00p 1.45% RS Group (RS1) 811.20p 1.40% InterContinental Hotels Group (IHG) 5,518.00p 1.40% Flutter Entertainment (CDI) (FLTR) 15,445.00p 1.35% Airtel Africa (AAF) 129.80p 1.33%

FTSE 100 - Fallers

SEGRO (SGRO) 786.20p -1.80% Vodafone Group (VOD) 73.77p -1.48% Fresnillo (FRES) 667.20p -1.48% Anglo American (AAL) 2,421.00p -1.47% BP (BP.) 462.45p -1.38% Rio Tinto (RIO) 5,057.00p -1.33% BT Group (BT.A) 145.30p -1.16% Shell (SHEL) 2,269.00p -1.11% St James's Place (STJ) 1,149.00p -0.95% Antofagasta (ANTO) 1,454.00p -0.92%

FTSE 250 - Risers

Kainos Group (KNOS) 1,375.00p 7.09% Wizz Air Holdings (WIZZ) 2,834.00p 4.00% Carnival (CCL) 942.00p 3.58% Games Workshop Group (GAW) 9,615.00p 3.22% TUI AG Reg Shs (DI) (TUI) 569.00p 3.17% Mitie Group (MTO) 98.90p 2.81% Moneysupermarket.com Group (MONY) 261.00p 2.51% Bakkavor Group (BAKK) 99.40p 2.47% NCC Group (NCC) 89.70p 2.40% Darktrace (DARK) 293.00p 2.38%

FTSE 250 - Fallers

Sirius Real Estate Ltd. (SRE) 86.20p -3.04% Telecom Plus (TEP) 1,446.00p -2.69% Plus500 Ltd (DI) (PLUS) 1,400.00p -1.89% Tullow Oil (TLW) 25.24p -1.87% Edinburgh Worldwide Inv Trust (EWI) 144.00p -1.64% Barr (A.G.) (BAG) 489.00p -1.61% Ithaca Energy (ITH) 150.80p -1.57% Harbour Energy (HBR) 247.10p -1.55% Ibstock (IBST) 157.50p -1.50% PureTech Health (PRTC) 236.00p -1.46%