London midday: Stocks stay down ahead of ECB; Elementis surges

(Sharecast News) - London stocks were still a little weaker by midday on Thursday, with traders cautious ahead of the latest policy announcement from the European Central Bank and US GDP data. The FTSE 100 was down 0.1% at 7,518.50.

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "The FTSE 100 has drifted lower in early trade as uncertainty reigns about the trajectory of interest rates in Europe, with exuberance from the Wall Street party not making a mark.

"As attacks in the Red Sea continue, geopolitical concerns are still bubbling, and there are not many fresh cues to help propel stocks higher in Europe.

"Policymakers at the European Central Bank are expected to sit on their hands and keep interest rates on hold, and an immobile stance through the year looks increasingly likely, given some of their recent comments. Investors will be highly attuned to the latest assessment of inflation and growth prospects from President Christine Lagarde.

"Even though there is has been a rapid slowdown in price increases, and weakness is pervading economies, the ECB is concerned that underlying price pressures in services remain strong and the effect of the Red Sea diversions on goods has not yet played out. With fresh attacks on Maersk ships taking military supplies to US forces, it seems unlikely there will be a resolution to that this tense situation any time soon."

The ECB rate announcement is due at 1315 GMT, while fourth-quarter US GDP figures and initial jobless claims are at 1330 GMT.

On home shores, the latest Distributive Trades Survey form the Confederation of British Industry showed that retail sales fell in January at the fastest pace in three years.

The CBI's retail sales balance declined from -32 in December to -50 - the worst level since December 2021 when the UK was in lockdown.

CBI principal economist Martin Sartorius said: "Looking ahead, demand conditions in the sector will remain challenging as higher interest rates continue to feed through to mortgage payments and household incomes."

In equity markets, St James's Place slid as its fourth-quarter net inflows missed estimates, while online trading platform IG Group lost ground as it reported a drop in interim revenues and profits, citing softer market conditions.

Wizz Air flew lower after the airline said losses widened in the third quarter.

Victrex and Pennon were both in the red as they traded without entitlement to the dividend.

On the upside, Intermediate Capital gained as it reported a jump in assets under management.

Iconic bootmaker Dr Martens rallied as it held full-year guidance after third-quarter revenues slumped by a fifth, driven by a poor performance in the US and from its wholesale channel.

Elementis surged following a report that KPS Capital Partners recently explored a bid for the specialty chemicals firm. According to Reuters, the New York-based private equity firm in December submitted an offer valuing the company at about 160p per share, but the Elementis board wanted around 180p.

Market Movers

FTSE 100 (UKX) 7,518.50 -0.12% FTSE 250 (MCX) 19,118.67 -0.28% techMARK (TASX) 4,341.56 -0.43%

FTSE 100 - Risers

Intermediate Capital Group (ICP) 1,706.50p 4.25% Smurfit Kappa Group (CDI) (SKG) 3,050.00p 2.83% Mondi (MNDI) 1,460.50p 2.17% BP (BP.) 458.45p 1.21% WPP (WPP) 762.20p 1.03% Marks & Spencer Group (MKS) 258.30p 0.98% Pearson (PSON) 961.80p 0.86% Smith (DS) (SMDS) 287.30p 0.81% Compass Group (CPG) 2,137.00p 0.80% Ashtead Group (AHT) 4,902.00p 0.78%

FTSE 100 - Fallers

St James's Place (STJ) 632.40p -6.45% RS Group (RS1) 750.60p -2.85% Standard Chartered (STAN) 595.20p -2.33% Hikma Pharmaceuticals (HIK) 1,908.50p -2.03% Melrose Industries (MRO) 580.00p -1.93% Fresnillo (FRES) 492.00p -1.84% GSK (GSK) 1,532.80p -1.41% Burberry Group (BRBY) 1,275.50p -1.16% Airtel Africa (AAF) 123.60p -1.04% Anglo American (AAL) 1,842.60p -0.98%

FTSE 250 - Risers

Elementis (ELM) 135.40p 9.19% Dr. Martens (DOCS) 80.95p 7.43% Tullow Oil (TLW) 35.08p 4.90% International Distributions Services (IDS) 285.50p 3.74% Moneysupermarket.com Group (MONY) 253.80p 3.00% Mitie Group (MTO) 102.20p 2.30% Me Group International (MEGP) 126.00p 2.27% Wood Group (John) (WG.) 174.10p 2.05% PPHE Hotel Group Ltd (PPH) 1,215.00p 1.67% Direct Line Insurance Group (DLG) 171.70p 1.36%

FTSE 250 - Fallers

IG Group Holdings (IGG) 717.50p -7.42% Close Brothers Group (CBG) 563.50p -3.59% Pennon Group (PNN) 685.00p -3.45% Senior (SNR) 154.40p -3.26% Wizz Air Holdings (WIZZ) 1,969.50p -2.98% Abrdn (ABDN) 170.05p -2.83% Aston Martin Lagonda Global Holdings (AML) 187.60p -2.75% Hochschild Mining (HOC) 93.00p -2.62% Crest Nicholson Holdings (CRST) 202.40p -2.60% Victrex plc (VCT) 1,325.00p -2.57%