London midday: Stocks push up despite gloomy data

(Sharecast News) - London stocks had extended gains by midday on Wednesday despite uninspiring Chinese factory data, grim UK shop price inflation and a bleak survey on service sector confidence. The FTSE 100 was up 0.6% at 7,555.83.

Figures released earlier by the National Bureau of Statistics showed that China's manufacturing activity shrank faster than expected in November as Covid restrictions took their toll.

The purchasing managers' index for the sector fell to 48.0 from 49.2 in October, coming in below consensus expectations of 49.0. A reading above 50.0 indicates growth, while a reading below signals contraction.

NBS Senior Statistician Zhao Qinghe said: "In November, impacted by multiple factors including the wide and frequent spread of domestic outbreaks, and the international environment becoming more complex and severe, China's purchasing managers' index fell."

Zhao said domestic Covid outbreaks had caused production activity to slow down and product orders to fall.

Meanwhile, the non-manufacturing PMI declined to 46.7 in November from 48.7 the month before, versus consensus of 48.0.

On home shores, industry data showed that shop price inflation ramped up in November, leaving retailers braced for an increasingly difficult Christmas.

According to the latest BRC-NielsenIQ Shop Price Index, annual inflation was 7.4%, compared to October's 6.6% and the three-month average of 6.5%. Annual food inflation surged to 12.4%, up from 11.6% in October, while non-food inflation was 4.8%, against 4.1% in October.

Separately, an industry survey showed that business optimism across the UK service sector continued to slide over the last three months.

According to the latest CBI Service Sector Survey, optimism deteriorated for the third consecutive quarter across the sector in the three months to November.

Markets participants were also digesting the latest eurozone data, which showed that headline inflation eased to 10% in November from 10.6% in October, paving the way for a 50 basis points rate hike by the European Central Bank.

Economists had been expecting it to slow to 10.4%.

Meanwhile, the core rate was steady at 5.0%, in line with the consensus. Energy inflation declined to 34.9% in November from 41.5% the month before, while food, alcohol and tobacco inflation increased to 13.6% from 13.1%.

Looking ahead to the rest of the day, investors were eyeing a speech by Federal Reserve chair Jerome Powell.

In equity markets, Rolls-Royce rallied after Barclays initiated coverage of the stock at 'overweight'.

Specialty chemicals company Elementis rose after agreeing to sell its chromium business to Dutch-Turkish industrial firm Yildirim Group for $170m.

Home REIT surged after it published a full response to allegations made by short seller Viceroy Research last week, which sent its shares sliding.

On the downside, Pennon was under the cosh as it said half-year profits tumbled after it was hit by higher costs.

Specialist media publisher Future reversed earlier gains to trade sharply lower despite reporting a rise in full-year profits, driven by strong revenue growth and contributions from acquisitions.

Market Movers

FTSE 100 (UKX) 7,555.83 0.58% FTSE 250 (MCX) 19,215.64 0.15% techMARK (TASX) 4,385.21 0.28%

FTSE 100 - Risers

Antofagasta (ANTO) 1,396.50p 2.38% Endeavour Mining (EDV) 1,725.00p 2.25% Anglo American (AAL) 3,363.50p 2.25% Ocado Group (OCDO) 628.60p 1.88% Rolls-Royce Holdings (RR.) 90.76p 1.84% Intertek Group (ITRK) 4,016.00p 1.83% Compass Group (CPG) 1,863.50p 1.80% Flutter Entertainment (CDI) (FLTR) 12,105.00p 1.59% InterContinental Hotels Group (IHG) 4,820.00p 1.58% Glencore (GLEN) 559.10p 1.51%

FTSE 100 - Fallers

British Land Company (BLND) 396.20p -2.10% Land Securities Group (LAND) 609.00p -1.87% Tesco (TSCO) 229.50p -1.50% DCC (CDI) (DCC) 4,409.00p -1.47% Haleon (HLN) 281.50p -1.35% Unite Group (UTG) 935.50p -1.16% Centrica (CNA) 93.72p -1.16% Smurfit Kappa Group (CDI) (SKG) 2,971.00p -1.07% Sainsbury (J) (SBRY) 221.00p -0.94% Airtel Africa (AAF) 123.10p -0.89%

FTSE 250 - Risers

Molten Ventures (GROW) 395.80p 4.76% Petrofac Ltd. (PFC) 87.80p 4.46% Wizz Air Holdings (WIZZ) 2,245.00p 4.42% Aston Martin Lagonda Global Holdings (AML) 129.90p 3.96% Dr. Martens (DOCS) 198.40p 3.87% Elementis (ELM) 112.40p 3.31% Carnival (CCL) 729.20p 3.23% Volution Group (FAN) 349.00p 2.95% Watches of Switzerland Group (WOSG) 1,022.00p 2.66% VinaCapital Vietnam Opportunity Fund Ltd. (VOF) 439.50p 2.45%

FTSE 250 - Fallers

Home Reit (HOME) 51.50p -7.71% Future (FUTR) 1,413.00p -4.72% Synthomer (SYNT) 134.80p -4.33% Abrdn (ABDN) 196.50p -4.24% W.A.G Payment Solutions (WPS) 76.70p -3.52% Warehouse Reit (WHR) 110.20p -2.99% 888 Holdings (DI) (888) 100.60p -2.33% Pennon Group (PNN) 918.50p -2.18% Jupiter Fund Management (JUP) 124.00p -2.05% Bridgepoint Group (Reg S) (BPT) 199.70p -2.01%